Transaction number 1 : Interest paid by a Country B’s corporation on a bond owned by a Country A’s bank Amount = $1’000 Transaction number 2 : Interest paid by Country A’s government on a treasury bills owned by Country C’s government Amount = $2’000 Transaction number 3 : Country A imports of coffee from Country B Amount = $3’000 Transaction number 4 : Country A’s citizen donation to a Non-Governmental-Organization located in Country A Amount = $4’000 Transaction number 5 : Country A’s sale of Country C’s government bonds Amount = $5’000 Transaction number 6 : Country B’s export of raw materials to Country C Amount = $6’000 Which transactions belong to Country A’s current accounts? Selected Answer: 3 and 5 3, 4, and 5 1, 2, 3, 4, 5 1, 2, 3

A current account is that account which includes the exports, imports, net income come from abroad, receipts and payments, net current transfers, etc.

The exports - imports is called the balance of trade

In mathematically,

Exports - imports = balance of trade

According to the above meaning, the following transactions would be considered as a current account

1: Interest paid by a Country B’s corporation on a bond owned by a Country A’s bank Amount = $1’000

2: Interest paid by Country A’s government on a treasury bill owned by Country C’s government Amount = $2’000

3: Country A imports of coffee from Country B Amount = $3’000

These transactions would be considered as a current account. Other ones should be ignored