Economics 2281 · O Level · Current account of balance of payments

Current account of balance of payments — practice question

70% of the 10 million kilograms of tea produced in India is exported. The largest purchasers are the UK, Japan, and Germany. Wholesale prices rose $10\%$ in 2013 because a strike restricted supply. How would these circumstances be recorded in international trade accounts?

  • Aa credit on the goods and services account for Germany
  • Ba debit on the goods and services account for Japan
  • Ca $10\%$ fall in the balance of the goods and services account for India
  • Da $10\%$ rise in the balance of goods and services account for the UK

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