Problem: Explain how each of the following transactions generates two entries -- a credit and a debit -- in the American balance of payments accounts, and describe in which part of the balance of payments (the current account or the capital account) each entry would show up.
(a) An American buys a share of German stock, worth $2000, and pays the seller with a check on an American bank.
(b) Mexico buys locomotives from the U.S. for a value of SI00,000, and agrees to pay 18 months later.
(c) What is the balance on the current account and the capital account after operations (a) and (b)?