what is balance of paymentand balance of trade?......i want the answer in points
1) Balance of payment is a record of the visible as well as invisible and unilateral transactions.It is a balance of current account as well as capital account. It indicates the inflow of foreign exchange into the country and the outflow of foreign exchange from the country. Those transactions that cause an inflow of foreign exchange are recorded as positive items in the BOP. On the contrary, those transactions that cause an outflow of foreign exchange from the country are recorded as negative items in the BOP.
2) Balance of trade is the balance of imports and exports. If exports increase imports,there is a trade surplus. If imports exceed exports,there is a trade deficit.The calculation is made in the Current Account. Balance of trade is a component of Balance of Payment.
2) Balance of trade is the balance of imports and exports. If exports increase imports,there is a trade surplus. If imports exceed exports,there is a trade deficit.The calculation is made in the Current Account. Balance of trade is a component of Balance of Payment.