TOPIC:BALANCE OF PAYMENT

BY-PRATHAMESH BELOSHE
ROLL NO.102
 MEANING OF BOP
It is a statement of all transactions made between entities in one country
and the rest of the world over a defined period, such as a quarter or a year.

A country has to deal with other countries in

respect of 3 items:-

Visible items

Invisible items

Capital transfers
FEATURES OF BOP:

It is a It includes all
systematic transactions,
record of all visible as
economic well as
transactions. invisible.
Receipts>Pay
ments is
It adopts a surplus in
double-entry the bop;
book-keeping Payments>R
system.
eceipt is
deficit in the
bop
 COMPONENT OF BOP:There are three
component of balance of payment are as
follows:

Current •Inflow and outflow of goods and services.

•E.g. Tourism, Stocks, Engineering,
Account commercial services, transportation.

Capital •It includes purchasing and selling of

non financial assets
account •E.g. land and properties

Financial •Flow of funds through various investment

•E.g. real estate, foreign direct investment,
account business ventures
 How to correct the BOP
• two ways i.e. Monetory and Non-monetory
measures are as follows:
 Monetory Measures-
1) Deflation
2) Devaluation
3) Exchange Depreciation
 Non Monetory Measures-
1) Export Promotion
2) Quotas
3) Tariffs
THANK YOU