If the Australian Government Sells a Bond to the Bank

question 71

Multiple Choice

If the Australian government sells a bond to the Bank of China, how is this recorded in Australia's balance of payments?

• A)a positive entry on the trade account
• B)capital inflow into Australia's financial account
• C)a negative entry on the financial account
• D)an increase in foreign direct investment into Australia

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Definitions:

Merchandise Inventory

Goods that a business holds for the purpose of resale to customers.

Multiple-Step Income Statement

A financial document that breaks down revenue, cost of goods sold, operating expenses, and net income into multiple steps or sections to show a detailed view of a company's financial performance over a specific period.

Administrative Expenses

These are costs related to the general operation of a business that are not directly tied to producing goods or services.

Selling Expenses

Costs associated with the marketing and selling of products or services, including advertising and sales commissions.