Question

The difference between the value of exports and the value of imports of goods of a country in a given period of time is known as by what name?

• A. Balance of Trade
• B. Balance of Payment
• C. Capital Account Deficit
• D. Net Invisibles

Hint:

BoT = goods only. BoP = goods + services + capital. Net Invisibles = services and transfers.

Answer 1

The Correct Option is A

Step 1: Define the terms.
- Balance of Trade (BoT): Difference between the monetary value of exports and imports of goods (merchandise trade).
- Balance of Payments (BoP): Comprehensive record of all economic transactions (goods, services, capital) with the rest of the world.
- Capital Account Deficit: Deficit in international capital transactions.
- Net Invisibles: Balance of services, transfers, and income flows, not merchandise.
Step 2: Apply to the question.
The question refers only to “exports and imports of goods”. This is exactly the definition of Balance of Trade.
Final Answer: \[ \boxed{\text{Balance of Trade}} \]