EC140 Chapter Notes - Chapter 35: Capital Account, Capital Outflow, Demand Curve
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EC140 Full Course Notes
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Document Summary
Balance of payments accounts: a summary record of a country"s transactions with the rest of the world, including the buying and selling of goods, services, and assets. Trade account: in the balance of payments, this account records the value of exports and imports of goods and services. Capital-service account: in the balance of payments, this account records the payments and receipts the payments and receipts that represent income on assets (such as interest and dividends) Capital account: the part of the balance of payments accounts that records payments and receipts arising from the purchase and sale of assets. Any surplus on the current account must be matched by an equal deficit on the capital account. A current account surplus thus implies a capital outflow. Any deficit on the current account must be matched by an equal deficit on the capital account. A current account deficit thus implies a capital inflow.
