Balance of Payment

Balance of Payment measures the economic transactions between a country and the rest of the world, based on a set of components, namely current account and capital account. Identify the sub-components that affect the current account, like the trade balance, service balance and income balance. Areas of study also include the causes and consequences of balance of payment deficit and surplus. By understanding how external factors can affect the balance of payment for a country, it will be useful to determine how governments can introduce appropriate policy responses to minimise the adverse impacts while reaping the desirable economic impacts, like financial stability.