Which term represents exports minus imports for a country?

Which term represents exports minus imports for a country?

• A. The balance of trade
• B. The balance of payments
• C. The current account
• D. The capital account

Answer: (B)

Exports minus imports for a country is called the balance of trade. It shows whether a country earns more from selling goods abroad than it spends on buying goods from abroad. A positive balance of trade means a trade surplus in goods; a negative balance means a trade deficit. The broader term, the balance of payments, counts all economic transactions with the rest of the world over a period and splits into the current account (which includes the trade balance plus income and current transfers) and the capital/financial accounts. So, the specific measure of exports minus imports is the balance of trade, while the balance of payments is the wider overall record.

Exports minus imports for a country is called the balance of trade. It shows whether a country earns more from selling goods abroad than it spends on buying goods from abroad. A positive balance of trade means a trade surplus in goods; a negative balance means a trade deficit. The broader term, the balance of payments, counts all economic transactions with the rest of the world over a period and splits into the current account (which includes the trade balance plus income and current transfers) and the capital/financial accounts. So, the specific measure of exports minus imports is the balance of trade, while the balance of payments is the wider overall record.