One of the more important measures in regard to international economics is the balance of payments

00 to 1100 words essay. One of the more important measures in regard to international

economics is the balance of payments. Think of it as a national

accounting measure that looks at the flow of goods and services into and

out of an economy in a given period of time. It also shows capital

flows into and out of a country. Until 1980, the United States tended to

run a positive-to-neutral balance of payments position and was a

creditor nation. In the course of the past 30 years, the United States

has moved to a negative balance of payments and to being a debtor

nation.

Review and discuss the following:

• Discuss the importance of the balance of payments as an accounting measure.
• Discuss the current account and its components and the capital and financial accounts and their components.
• How important is the U.S. deficit in traded goods in regard to the balance of payments?

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