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Identify whether each of the following is a debit or a credit in the country of
Freedonia’s BOP and indicate where the item would be classified (5 points)

a) Freedonian firms export $250 million worth of goods.

b) Freedonian citizen’s purchase $50 million worth of tickets on US Airways flights.

c) A Freedonian firm purchases a shoe factory in Mexico for $30 million.

d) Freedonia receives $5 million in foreign aid from the United States.

e) Freedonian citizens deposit $15 million in Citibank account in New York.

f) Freedonia imports $220 million worth of goods.

g) Freedonian firms borrow $45 million by issuing bonds in the United States

h) U.S. firms earn (and repatriate) $5 million in profits from operations in Freedonia.

i) The Freedonia central bank buys $10 million in U.S. Treasury bills.

Respuesta :

adefioyelaoye
  • Freedonian firms export $250 million worth of goods - Credit
  • Freedonian citizen’s purchase $50 million worth of tickets on US Airways flights - Debit
  • A Freedonian firm purchases a shoe factory in Mexico for $30 million - Debit
  • Freedonia receives $5 million in foreign aid from the United States - Credit
  • Freedonian citizens deposit $15 million in Citibank account in New York - Debit
  • Freedonia imports $220 million worth of goods - Debit
  • Freedonian firms borrow $45 million by issuing bonds in the United States -  Credit
  • U.S. firms earn (and repatriate) $5 million in profits from operations in Freedonia. -  Debit
  • The Freedonia central bank buys $10 million in U.S. Treasury bills - Credit

What is BOP?

This is also known as Balance of payment and it is the difference between all money flowing into the country in a particular period of time and the outflow of money to the rest of the world.

Freedonia’s BOP items can be seen above with their appropriate classifications.

Read more about Balance of payments here https://brainly.com/question/10015758

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