Economics 0455 · IGCSE · Current account of balance of payments

Current account of balance of payments — practice question

A developing economy records a surplus on its trade in goods of $\text{\$}75$ billion and a deficit on its trade in services of $\text{\$}25$ billion, with its current account balanced overall. Which amounts of net income (primary income) and net transfers (secondary income) would make the current account balance?

  • Anet income: deficit of $\text{\$}20$ billion; net transfers: surplus of $\text{\$}120$ billion
  • Bnet income: deficit of $\text{\$}30$ billion; net transfers: deficit of $\text{\$}70$ billion
  • Cnet income: surplus of $\text{\$}35$ billion; net transfers: surplus of $\text{\$}15$ billion
  • Dnet income: surplus of $\text{\$}40$ billion; net transfers: deficit of $\text{\$}90$ billion

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