Flow of Goods/Services & Capital and BOP & Domestic Economic Behavior
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Relate the international flow of goods, services, and capital to the balance of payment and domestic economic behavior.
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Solution Summary
350 words to define and relate a number of finance terms. The expert examines capital and BOP and domestic economic behavior.
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BALANCE OF PAYMENT MAY BE DEFINED AS SYSTEMATIC RECORD OF ALL ECONOMIC TRANSACTIONS BETWEEN A RESIDENT OF THE COUNTRY AND THE REST OF THE WORLD DURING THE GIVEN PERIOD.
Thus the Balance of Payments 'BOP' is an account of all transactions between one country and all other countries--transactions that are measured in terms of receipts and payments. From the U.S. perspective, a receipt represents any dollars flowing into the country or any transaction that require the exchange of foreign currency into dollars. A payment represents dollars flowing out of the country or any ...
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