Reena says that the difference between the value of exports and the value of imports of goods of a country in a given period of time is called the balance of trade. Meenu says that it is called the trade balance. Who is correct?
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → Both of them are correct
The difference between the value of exports and imports of goods is the balance of trade (BOT). The same thing is also called the trade balance. So Reena and Meenu use two names for one concept.
NCERT (2026-27): “Balance on Current Account … Balance of Trade (BOT) is the difference between the value of exports and value of imports of goods of a country in a given period of time. Export of goods is entered as a credit item in BOT, whereas import of goods is entered as a debit item in BOT. It is also known as Trade Balance. …” |