In the Balance of Payments, If There Are No Statistical

question 202

Multiple Choice

In the balance of payments, if there are no statistical errors or discrepancies, which of the following is true of the sum of the capital account balance, the current account balance, and the official reserve transactions account balance?

• A) This sum is either positive or negative, depending on whether the sum of all surplus and deficit items associated with cross-border transactions is positive or negative.
• B) This sum must always be zero, because the sum of all surplus and deficit items associated with cross-border transactions must equal zero.
• C) This sum is positive only if the U.S. government operates with a budget surplus.
• D) This sum is positive only if the U.S. government operates with a budget deficit.

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Definitions:

Negotiable Instrument

A written promise to pay a certain sum of money, which can be demanded or paid at an agreed time, specifying the person responsible for payment in the document.

Holder

An individual or entity that legally owns or possesses a document, instrument, or title.

Authenticating Intent

the process of verifying that the actions or signatures of a person are genuine and intended to validate a legal document or agreement.

Indorsement

The act of signing a document, typically on the back of a negotiable instrument, indicating the legal transfer of its ownership.