Balance Of Payments

Question 1

Current account

Answer 1

Account identifying transactions in goods and services between the residents of a country and the rest of the world

Question 2

Capital account

Answer 2

Account identifying transactions in physical capital between the residents of a country and the rest of the world

Question 3

Financial account

Answer 3

Account identifying transactions in financial assets between the residents of a country and the rest of the world

Question 4

Current account income payments

Answer 4

The earnings of UK nationals from employment abroad and payments of investment income

Question 5

Current account international transfers

Answer 5

Mainly transactions between governments which make up the largest component
Flows of bilateral aid and social security payments abroad included

Question 6

Current account balance of trade in goods and services

Answer 6

Balance between UK exports and imports such as goods and services
+ve entry = inflows of foreign currency X
-ve entry = outflows of foreign currency M

Question 7

Imbalance

Answer 7

Balancing item used to balance errors and omissions