Question

Using the chart below show how to show how to calculate the balance on goods, the balance on goods, and services, the balance on goods and services and the current account balance.

Goods and Services	Billions of Dollars
Exports of Goods	$1,455.70
Imports of Goods	$2,208.21
Exports of Services	$752.37
Imports of Services $504.65	$504.65
Net Income From Abroad
Investment Income Receipts	$807.43
Investment Income Payments	$620.61
Compensation of employees (Receipts)	$6.55
Compensation of employees (Payments)	$20.14
Unilateral transfers	-$120.12
Source: US Department of Commerce, Bureau of Economic Analysis

Answer 1

Balance on goods and services also called balance of trade . It is the difference between total goods and services exported and total goods and services imported in a country.

Balance on goods = exports of goods - imports of goods

Balance on services = exports of services - imports of services

Balance on goods and services = total exports of goods and services - total imports of goods and services

Also addition toh balance of goods and balance if services gives balance of goods and services in a particular period in an economy

Current account balance - it is outflow and inflow of goods ans services, investment incomes and transfer incomes.

Main components-

1. Trade in goods

2. Trade in services

3. Investment incomes ( receipts- payments)

4. Net Transfers

5 compensation of employees ( receipts- payments)