AP Macro Unit 6 Vocab

Trade Surplus

• The difference between the purchase of foreign assets and domestic assets purchased by foreigners

• Exporting more than is imported

• Measures the purchase and sale of financial assets abroad (things that continue to earn money).

• Exporting less than is imported (a.k.a Trade gap)

• Measures trades of goods and services, investment income, and net transfers

Trade Deficit

• The difference between the purchase of foreign assets and domestic assets purchased by foreigners

• Exporting more than is imported

• Measures the purchase and sale of financial assets abroad (things that continue to earn money).

• Exporting less than is imported (a.k.a Trade gap)

• Measures trades of goods and services, investment income, and net transfers

Net Capital Outflow

• The difference between the purchase of foreign assets and domestic assets purchased by foreigners

• Exporting more than is imported

• Measures the purchase and sale of financial assets abroad (things that continue to earn money).

• Exporting less than is imported (a.k.a Trade gap)

• Measures trades of goods and services, investment income, and net transfers

Current Account

• The difference between the purchase of foreign assets and domestic assets purchased by foreigners

• Exporting more than is imported

• Measures the purchase and sale of financial assets abroad (things that continue to earn money).

• Exporting less than is imported (a.k.a Trade gap)

• Measures trades of goods and services, investment income, and net transfers

Capital Financial Account

• The difference between the purchase of foreign assets and domestic assets purchased by foreigners

• Exporting more than is imported

• Measures the purchase and sale of financial assets abroad (things that continue to earn money).

• Exporting less than is imported (a.k.a Trade gap)

• Measures trades of goods and services, investment income, and net transfers

Net Exports

• Considers ALL international transactions

• Exports – Imports

• Inflow > Outflow

• Includes only goods and service

• Inflow < Outflow

Balance of Payments

• Considers ALL international transactions

• Exports – Imports

• Inflow > Outflow

• Includes only goods and service

• Inflow < Outflow

Balance of Trade

• Considers ALL international transactions

• Exports – Imports

• Inflow > Outflow

• Includes only goods and service

• Inflow < Outflow

Account Surplus

• Considers ALL international transactions

• Exports – Imports

• Inflow > Outflow

• Includes only goods and service

• Inflow < Outflow

Account Deficit

• Considers ALL international transactions

• Exports – Imports

• Inflow > Outflow

• Includes only goods and service

• Inflow < Outflow