What is the term for the annual record of a country's export earnings and import expenditure, with a surplus when exports exceed imports?

What is the term for the annual record of a country's export earnings and import expenditure, with a surplus when exports exceed imports?

• A. Balance of Payments
• B. Direct tax
• C. Economic growth
• D. Exchange rate

Answer: (A)

Balance of payments is the annual record of a country’s international economic transactions, capturing what the country earns from exports and spends on imports, along with other financial flows. When exports exceed imports, the balance of payments shows a surplus, indicating more money is coming into the country from trade than is leaving through trade, all other financial movements aside. This concept helps show the country’s external financial position and how demand for its goods and services compares with demand for foreign goods and services. The other options refer to different ideas—direct tax is a tax on income, economic growth is about rising output, and the exchange rate is the value of one currency in terms of another.

Balance of payments is the annual record of a country’s international economic transactions, capturing what the country earns from exports and spends on imports, along with other financial flows. When exports exceed imports, the balance of payments shows a surplus, indicating more money is coming into the country from trade than is leaving through trade, all other financial movements aside. This concept helps show the country’s external financial position and how demand for its goods and services compares with demand for foreign goods and services. The other options refer to different ideas—direct tax is a tax on income, economic growth is about rising output, and the exchange rate is the value of one currency in terms of another.