2. Understanding BOP
Kindle Berger
"The balance of payments of a
country is a systematic record of
all economic transactions
between the residents of the
reporting country and residents
of foreign countries during a
given period of time".
The balance of payments
(BOP), also known as balance
of international payments,
summarizes all transactions
that a country's individuals,
companies, and government
bodies complete with
individuals, companies, and
government bodies outside the
country.
“The balance of payments of a
country is a systematic record of
all economic transactions
between the residents of a
country and the rest of the world.
Reserve Bank Of India
3. Features Of
BOP
Systematic record of all economic transactions
Includes all transactions
Relates to a period of time
Has a double-entry book-keeping system
4. Importance Of
BOP
Examine the transaction
Helps the government to analyse
Detects the state of the economy
Judge economic and financial status of a
country in the short-term
Confirms trends in the economy's
international trade and exchange rate of the
currency