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The structure:
Please watch the following Youtube videos to introduce this important topic
Most of the structure and meaning of the Balance of Payments should be self-explanatory. But there are a couple of tricky issues.....
Capital Transfers include: Debt forgiveness; insurance claims between countries; grants for investment.
Transactions in non produced goods: transactions in land or resources (but they cannot be produced or they would be in the current account).
Finally remember that an increase in reserves is a negative as your own currency is flowing out of the country to purchase these reserves. In reality this is why the Balance of Payments balances.
3.3 the Balance of Payments notes 2019 SL.docxQuick activity to check your understanding of how the Balance of Payments is constructed. How would the following be measured in the country's (in bold) BOP?
An activity where you match the term with the appropriate definition:
0079_001.pdf
And if you have finished the activities above, feel free to look at these (HL students only):
BOP True or false.pdfBOP fill in the gaps.pdfHL topics
International Economics 3.3.4 Current account surplus Note sheet.docxInternational Economics 3.3.1 Structure of the Balance of payments Note sheet.docxInternational Economics 3.3.2 Relationships between the accounts Note sheet.docxInternational Economics 3.3.3 The relationship between the current accounnt and the XR Note sheet.docxBOP_SL_2020.pdfPage updated
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