Economics · Oct / Nov 2017 · Paper 13 · Question 29

A developing economy has a surplus on its trade in goods of $75 billion and a deficit on its trade in services of $25 billion, while its current account is in overall balance. Which values for net income (primary income) and net transfers (secondary income) result in the current account being in balance?

1. Anet income: deficit of $20 billion; net transfers: surplus of $120 billion
2. Bnet income: deficit of $30 billion; net transfers: deficit of $70 billion
3. Cnet income: surplus of $35 billion; net transfers: surplus of $15 billion
4. Dnet income: surplus of $40 billion; net transfers: deficit of $90 billion

As printed in the paper