Question

State with reasons whether you agree or disagree with the following statement.

The balance of Payment is the same as the Balance of Trade.

Options

• Agree

• Disagree

Answer 1

I disagree with the given statement.

Reason:

A country's balance of payments is a detailed accounting of all its foreign economic transactions over a specific time period, often a year. The difference between a country's exports and imports for a specific time period is referred to as the trade balance.

A more comprehensive idea than the balance of commerce is the balance of payment. The value of the trade of products and services between individuals, businesses, organizations, the government, etc. is included in the balance of payments. While the value of imports and exports of both visible and invisible products is included in the trade balance. As a result, the ideas of the balance of payment and the balance of trade are distinct.