Indicate How The Following Transaction Is Entered In To The Us Balance Of Paymen

1.Indicate how the following transaction is entered in to the US balance of payments with double entry bookkeeping.A foreign investor purchases $ 400 of U.S treasury bills and pays by drawing down his bank balance in the USA.

2. Indicate how the following transaction is entered in to the U.S balance of payments with double-entry book keeping.A t maturity (during the same year),the foreign investor of Problem 6 receives $ 440 for the principal and interest earned and deposits these dollars in his bank account in his own nation.

3.Indicate the following transactions entered in to the U.S balance of payments with double-entry book keeping.

A. The U.S government gives $ 100 worth of food aid to developing nation.

B. What is the difference in their effect on the balance of payments between transactions.

1.Answer: transaction Credit ( +) Debit ( -) Capital inflow ( the purchase of U.S. treasury billsby foreigner) $400 Capital Outflow (the reduction in the foreign bankbalance in the U.S.) $400…

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