Balance of payments

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  • Created by: Lottie
  • Created on: 24-04-12 14:05

Balance of Payments

The balance of payments provides us with important information about whether or not a country is “paying its way” in the international economy.

What is the Balance of Payments?

·         records all of the many financial transactions that are made between consumers, businesses and the government in the UK with people across the rest of the World.

·         tell us about how much is being spent by British consumers and firms on imported goods and services

·         how successful UK firms have been in exporting to other countries and markets. Why is the export sector of the economy vital for the UK?


Trade in goods includes items such as:
Manufactured goods
Semi-finished goods and components
Energy products
Raw Materials
Consumer goods
(i) Durable goods e.g. DVD recorder and new cars
(ii) Non-durable goods e.g. foods and beverages
Capital goods (e.g. new plant and equipment)

Trade in services includes:
Banking, insurance and consultancy services
Other financial services including foreign exchange and derivatives trading
Tourism industry
Transport and shipping
Education and health services
Services associated with research and development
Cultural arts

Trade in goods

·         includes exports and imports of oil and other energy products

·         manufactured goods, foodstuffs, raw materials and components.

·         exporting and importing of tangible products

Trade in services


Former Member

This is awesome...thanks so much



This is a brief revision note on the balance of payments. There is a test yourself facility to help assess progress.


Great information. Also thought it would be helpful to include the description of What is a Finance Charge as its very relevant to the understanding to the impact of finances.  

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