Question

The difference between value of goods sold by the residents and firms of home country to foreigners and value of goods purchased by them from foreigners is called ___________.

• A. balance of trade
• B. balance of current account
• C. balance of payment on capital account
• D. balance of payments

Answer 1

The correct option is A balance of trade

Balance of trade is defined as the difference between the value of a country's import and export for a given period of time. Hence, the difference between value of goods sold by the residents and firms of home country to foreigners and value of goods purchased by them from foreigners is called balance of trade.