Which of the following transactions would be included in Germany's current account?
A)A German citizen purchases 100 shares of Texas Instruments stock.
B)An American citizen purchases 100 shares of BMW stock.
C)A German citizen purchases a new Volkswagen made in Germany.
D)An American citizen purchases a new Volkswagen made in Germany.

Question

Quizplus · Accepted Answer

Transactions included in a country's current account typically involve the trade of goods and services. The purchase of a new Volkswagen made in Germany by an American citizen (D) is an export of goods, which is recorded in the current account. Choices A and B involve financial transactions not recorded in the current account, and choice C is a domestic transaction that does not affect international trade balances.

Which of the Following Transactions Would Be Included in Germany's