Balance of Payments and Balance of Trade

Balance of Payment
The term Balance of Payment refers to a complete and comprehensive account of a country's entire commercial transactions with rest of the world. BoP is the figure showing the balance between a nation's earning from abroad and its spending abroad. If the value of imports exceeds that of exports, a deficit balance results. If export are worth more than imports, there is a favorable Balance of Payment. Balance of Payment is the most important factor in determining the exchange rate of country's currency.


Balance of Trade

The term Balance of Trade refers to the difference of the visible exports and imports of the countries in trade with each other. If the export are more, it is called favorable balance of trade and if the imports are more than the exports, it is called unfavorable Balance of Trade. Usually developed countries have favorable Balance of Trade and developing countries have unfavorable Balance of Trade 

Comments

Post a Comment

Popular posts from this blog

Economic Growth and Economic Development

Image
Economic Growth Economic growth means a process of sustained increase in real income of a country over a long period of time . The essential point in initiating and maintaining growth is that the country has to build up certain growth propelling forces through investments in various sectors of economy which lead to continued increase in real national income over longer time horizon.Favorable  seasonal factor should not be confused with growth. Growth is along term process. Economic Development Economic development has a wide concept. Economic development means growth plus achieving of some other social objectives such as  increased employment,  income re-distribution in favor of poor,  poverty alleviation,  culture of modernization, change in attitude as well as mode of thinking and behavior Economic development is a multi- dimensional process which seeks to uplift the entire social and economic structure of the society 
Read more

Himalayas or Northern Mountains

Image
The Himalayas or Northern Mountains consist of the youngest and loftiest mountain chains in the world The width of the Himalayas varies from 500 km in Kashmir to 200 km in Arunachal Pradesh The Pamir popularly known as the "Roof of the World" is the connecting link between Himalayas and the high ranges of the central Asia Geographically the entire Himalayan regions can be divided into The Himalayan Ranges The Trans-Himalayas The Eastern Hills 1. Northern Mountains The Himalayas are not a single chain or range of Mountains, but a series of several, more or less parallel or converging ranges Most of the Himalayan ranges fall in India, Nepal and Bhutan, but the northern slope are partly situated in Tibet while the western extremity lies in Pakistan, Afghanistan and Central Asia   (a) The Shiwalik Range The Shiwalik comprise the outermost range of Himalayas and is known as the Outer Himalaya The width of the Shiwalik varies from 50 km in Himachal Prade
Read more

Great Plain of India

The central and eastern part of the plain have been formed by the tributaries of the Ganga and the Bramaputra rivers. The western parts, the Punjab plains were formed by the tributaries of Indus  The Great plains are of recent origin, less than two million year sold. They are composed wholly of sediments which were deposited by the rivers The depth of the sediments varies from place to place. The maximum thickness of the sediments is believed to be about 3000m, in the central part of the plain. Half of the great plain lies in Uttar Pradesh and half in the states of Bihar, West Bengal, Assam, Punjab and Hariyana This is the largest alluvial tract of the world Physical Features The Bhabar: A narrow belt running east - west direction along the foot hills of Shiwalik from Indus to Tista Consisting of gravel and assorted sediments The porosity of the pebble studded rock beds is so high that most of the streams sink and flow under ground. Therefore, the area
Read more