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CT7 super Last minute que

Y

Yactuary

Member
How do we define Balance of Trade?
Is this just based on 'good' (i.e tangible goods only) or does this include services?
Q36 2011 S marking scheme suggest that its goods only. However some texts say we should include services. What is the correct way to go about such a question?

Thanks in Advance
 
From Module 16...

The Balance of trade is split into two categories in the current account:

Balance of trade in goods: c = Exports of goods - imports of goods
Balance of trade in services: f = Exports of services - imports of services

Balance of trade in goods and services = c + f

So from the above, I would say that you should include services!
 
Balance of trade should include both goods and services.

In the exam question you are referring to, the examiners accepted both interpretations though.
 
Good. Was worried for a moment.

Thanks for the confirmation. Now to the exam centre! :cool:
 
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