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2 marksBalance of Payments and Exchange Rates

CAPE Economics Unit 2 · 2012 · Paper 2 · Question 6(a)(i)

Explain the difference between a 'current account transaction' and a 'capital account transaction' in the balance of payments statement.

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Other parts of this question

  1. 6(a)(ii)a)Using the data in the table, calculate the current account balance.[3 marks]
  2. 6(a)(ii)b)Using the data in the table, calculate the overall balance of payments.[2 marks]
  3. 6(b)Outline FOUR ways in which a global recession may impact the main accounts of the balance of payments.[8 marks]
  4. 6(c)Distinguish between 'absolute advantage' and 'comparative advantage'.[4 marks]
  5. 6(d)Discuss TWO policy options that a country may use to correct a trade deficit.[6 marks]

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