Question : The balance of payments is a:
Option 1: Snapshot of a country's economic transactions at a specific point in time
Option 2: Projection of a country's future economic performance
Option 3: Comparison of a country's exports and imports over a given period
Option 4: Record of a country's stock of foreign assets and liabilities
Correct Answer: Snapshot of a country's economic transactions at a specific point in time
Solution : The correct answer is (a) Snapshot of a country's economic transactions at a specific point in time.
The balance of payments is a systematic accounting record of all economic transactions between residents of a country and the rest of the world over a specific period, usually a year. It provides a snapshot or a summary of these transactions at a given point in time.
The balance of payments includes various components such as the current account, capital account, and financial account. The current account reflects trade in goods and services, income flows, and unilateral transfers, while the capital and financial account records capital flows and changes in foreign assets and liabilities.
So, to clarify, the balance of payments is a record or snapshot of a country's economic transactions at a specific point in time, which covers its trade, financial flows, and other economic interactions with the rest of the world.
Question : The balance of payments is a systematic record of a country's:
Option 1: Imports and exports only
Option 2: Imports and financial transactions only
Option 3: Imports, exports, and financial transactions
Option 4: Imports, exports, and domestic production
Question : The balance of payments is a systematic record of all and transactions between a country ____________and _____________the rest of the world.
Option 1: economic, financial
Option 2: goods, services
Option 3: capital, current
Option 4: imports, exports
Question : When a country's imports exceed its exports, it results in:
Option 1: A trade deficit
Option 2: A trade surplus
Option 3: A balance of payments surplus
Option 4: A balance of payments deficit
Question : When a country's imports exceed its exports, it is said to have a:
Option 1: Trade deficit
Option 2: Trade surplus
Option 3: Balance of payments surplus
Option 4: Balance of payments deficit
Question : The balance of payments helps in assessing a country's _____________and ______________with other countries.
Option 1: relationships, cooperation
Option 2: trade, investments
Option 3: economic, financial
Option 4: exports, imports
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