Balance of Payments (BOP) Exam Questions with Correct Answers

Balance of International Indebtedness Correct Answer A record of the flow of economic transactions between the residents of one country and the rest of the world. Balance of Payments Correct Answer A record of the flow of economic transactions between the residents of one country and the rest of the world. Capital and Financial Account Correct Answer The net result of both private sector and official capital and financial transactions. Credit Transaction Correct Answer A balance of payments transaction that results in a receipt of a payment from foreigners. Current Account Correct Answer The net value of monetary flows associated with transactions in goods and services, investment income, employee compensation, and unilateral transfers. Debit Transaction Correct Answer A balance of payments transaction that leads to a payment to foreigners. Double Entry Accounting Correct Answer A system of accounting in which each credit entry is balanced by a debit entry, and vice versa, so that the recording of any transaction leads to two offsetting entries. Goods and Services Balance Correct Answer The result of combining the balance of trade in services and the merchandise trade balance. Income Balance Correct Answer Net investment income plus net compensation of employees. Merchandise Trade Balance Correct Answer The result of combining the dollar value of merchandise exports recorded as a plus (credit