?Alpha\'s balance-of-payments data are shown below. All figures are in billions
ID: 2439870 • Letter: #
Question
?Alpha's balance-of-payments data are shown below. All figures are in billions of dollars.
?Alpha's Balance-of-Payments Data
Merchandise exports
500
Service imports
30
Net unilateral transfers
20
Net change in foreign assets at home? (financial inflows)
270
Merchandise imports
600
Service exports
75
Net change in domestic liabilities abroad? (financial outflows)
negative 235
The balance of trade is
?$????
billion. ?(Enter your response as a whole number and include a minus sign if? necessary.)
The balance on the current account is
?$????
billion. ?(Enter your response as a whole number and include a minus sign if? necessary.)
The balance on the financial account is
?$?????
billion. ?(Enter your response as a whole number and include a minus sign if? necessary.)
?Alpha's Balance-of-Payments Data
Merchandise exports
500
Service imports
30
Net unilateral transfers
20
Net change in foreign assets at home? (financial inflows)
270
Merchandise imports
600
Service exports
75
Net change in domestic liabilities abroad? (financial outflows)
negative 235
Explanation / Answer
Trade Balance = Current account + capital account
Capital account = Capital inflow+ capital outflow
Capital account = $270 -$ 235 = $35 billion
Currentaccount balance = Merchandise exports+ service exports -( merchandize import+ service exports)+ Net tr ansfers
account balance = $500+$75-($600+$30)+ $20 = -$55 billion
Trade balance = capital account + current account = $35+(-$55)= -$20 billion
Trade balance on current account = -$55 billion
Trade on capital account = $35 billion
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