Describe some offsetting transaction that could ensure that the india current accounts and the capital and financial account balances would continue to sum zero.
Answers
Explanation:
Few economics are closed in Chapter 4. Trade allows economics to spend more than it produces temporarily. The economy can import more than it exports, and borrow from abroad to pay the difference: This creates a trade deficit, creating foreign debt which must be paid in the future. The main determinant of the foreign trade of a country is its investment and saving choices.
I. Balance of Payments Accounting (Section 5.1)
A. Introduction
1) Expands the national income accounts from chapter two to include international transactions.
2) Credits—Any transaction that involves a flow of money into the domestic economy, exports are the best example.
3)Debits-Any transaction that involves a flow of money out of the domestic economy, imports are the best example
B. The Current Account—Measures countries trade in currently produced goods and services total of: Net Exports of Goods and Services; Net investment income from abroad; and Net unilateral transfers.
1) Net Exports of Goods and Services (NX in expenditure