Question

what are the underlying principles of balance of payments

Answer 1

Hi..
Following are the principles of BOP:

a) Purchases and sales of goods and services against financial items i.e. the interchange of goods and services against claims and monetary gold.

b) Barter, i.e. the interchange of goods and services against other goods and services.

c) The interchange of financial items against other financial items.

d) The provisions or acquisition of goods and services without requital.

e) The provision or acquisition of financial items without requital.

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