Define balance of payment or BOP
Balance of payment: It is a systematic record of each and every economic transaction of a country with the rest of world in an accounting year.
Question 1: The financial crisis that hit the United States first and then the world economy starting in fall 2007 meant that the future prospects of many firms looked gloomy at best for some time. Comment on the e
In a completely employed economy, the higher the yield of capital goods, and the bigger its: (1) Present living standards. (2) Present output of consumer goods. (3) Growth of capacity for the future production. (4) Rates of inflation and unemployment.
Describe the meaning of deficit in BOP: Whenever autonomous foreign exchange payments surpass autonomous foreign exchange receipts, the difference is termed as balance of payments deficit.
Components of capital account of balance of payment: A) Borrowing and lending to and from abroad.B) Change in foreign exchange reserves C) Investment to and from abroad.
Flexible (or floating) exchange rate system: This is a system in which exchange rate is found out by forces of demand and supply of the foreign currencies concerned in the foreign exchange market. There is no official interference in the foreign excha
Assume that El Salvador can generate coffee at lower opportunity costs than Spain, whereas Spain can generate olive oil at lower opportunity costs than El Salvador. The citizens of both countries can potentially profit from international trade since of the efficiency
Balance of payments (BOP) always balances. Describe it. Answer: Balance of payments is for all time balanced. The negative balance on current account is equated wit
Who explained micro and macro economics?
In simple circular flow model, the only entities which finally consume goods, own resources, pay taxes or bear the loads of inflation, experience joy, or suffer pain, are as: (i) corporations. (ii) Households. (iii) Government agencies. (iv) Business
Components of current account of BOP account: (A) Import-Export of goods(B) Import-Export of services(C) Unilateral transfers
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