Discuss the importance of the balance of payments as an accounting measure.

Discussion
Name
Institution
Course
Date
DISCUSSION
Q.1
Balance of payments is used to evaluate the flow of goods and services in a certain economy for a given period. Alternatively, it is used to indicate the flow of capital in and out of a country. Balance of payments is very important to the investors because it assists them to make informed decisions. Thus the balance of payment is used to scrutinize whether certain resources are worth investing. Additionally, the balance of payments is used to ascertain if the export volume of a nation can be used to cater for its imports (Pettinger, 2017). Today, observers from different nations examine if some nation's balance of payment has a surplus or deficit.
Q.2
The current account is used to measure the imports and exports of services, goods, and trade in capital of a country. The current account is used to show the flow of goods and services in and out of a nation, including cash transfers and its earnings on reserve. The major components of the current accounts are net income, asset income, direct tran...