Credit (+) Items in the Balance of Payments Correspond to Anything

question 95

Multiple Choice

Credit (+) items in the balance of payments correspond to anything that:

• A) Involves receipts from foreigners
• B) Involves payments to foreigners
• C) Decreases the domestic money supply
• D) Increases the demand for foreign exchange

---

Definitions:

Demand

The quantity of a good or service that consumers are willing and able to purchase at different prices during a specific time period.

Perfectly Inelastic

Describes a situation where the quantity demanded or supplied does not change in response to a change in price.

Price Elasticity

A tool for measuring how changes in price impact the demand for a particular item.

Excise Tax

Excise Tax is a specific tax levied on particular goods, services, or transactions, often included in the price of products like gasoline, tobacco, and alcohol.