Balance of Payment (BOP):
It is an account of what is received by resident of a country from the rest of world and what these residents have paid out to other countries on account of sale of goods, services and other invisible items as well as on account of capital transfers from the other countries. It is divided into two accounts.
Current Account: It maintains all the transactions related to the exchange of goods and services and unilateral transfers. It includes shipping insurance and banking services, investment income, foreign travel, transfer payments and
Financial Account: It provides details of all the capital transfers such as investment and loans between one country and the rest of the world. Some components are banking capital, official capital, private capital and gold and foreign capital.
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