Can You Distinguish Between Balance Of Trade And Balance Of Payments?

In order to calculate the balance of trade, you must calculate the difference between a country’s imports and exports. The goal is to have a surplus. In this situation, the value of a nation’s exports is higher than the import’s value. A truly wealthy nation has a large surplus, and maintains a high level of valuable export trade. A poor nation is one that cannot maintain a surplus. They do not make enough money through exporting to make up for the debt they acquire from importing. The balance of trade isn’t technically stable in any country. This is due to crop failures, unpredictable death of livestock, mining accidents, supply-and-demand issues, increases in taxes and tariffs, instability of the currency value, the availability and cost of raw materials needed in manufacturing, and production costs. Economies that have a wider variety of exports tend to have stronger economies because there is more probability that some of their exports will make a profit.

Balance of payments is calculated based on every type of transaction (this includes exports, imports, service trade, transfers, loans, debt payments, bonds, and capital) that a particular country has with everyone else in the entire world. If the country is in debt, it is called a deficit. If the country has money, they have a surplus. A country can have a surplus in the balance of trade, but have a deficit in the balance of payments. For example, a country might have millions of diamonds and rubies they export every year which creates a huge surplus. They might not need to import very many goods, so they gain wealth in trade. This same country might have racked up billions of dollars in debt by taking out loans with another country, and the amount of money gained through exports does not make up the difference. It would be at a deficit overall.

Balance of trade is the difference in the value of exports and imports of a country in a specific period of time.
Balance of payment is the systematic record of all economic transactions that take place between the individuals of the country and the rest of the world.

Although the totals of payments and receipts are necessarily equal, there will be inequalities—excesses of payments or receipts

A balance of trade surplus is most favorable to domestic producers responsible for the exports. However, this is also likely to be unfavorable to domestic consumers of the exports who pay higher prices.

Balance of trade is actually the legally imports and exports of the country is in equilibrium states.means the total export done by nation and total import coming from another nation is equal or equilibrium.while the balance of payment is slightly different form balance of payment,balance of payment is actually based on current account,capital account and official settelments acount,balance of payment is,doing payment to abroad and the payment which comes from the abroad is balanced.balance of trade is the part of balance oy payment.

Balance of trade is the difference between the monetary value of exports and imports of a given economy while the balance of payments is an accounting records of monetary transanctions between a country and the rest of the world.

There is not even a single country in the world to claim self sufficient. The time and stage of self sufficiency is over. As a result of international economic relations there is a flow of goods and service between the countries. The exporting country receives the value of the products from the importer country. The outflow of goods and service creates credit for the country and inflow of goods and services constitutes debit for the country. The receipt and payments have to balance in the long run. A comprehensive statement of receipts and payments of a country over a period of time constitutes the balance of payment sheet.

The balance of payment sheet may be defined as a comprehensive record of economic transaction of the residents of the world during a given time period of time. The record is so prepared as to provide meaning and measures to the various components of a country's external transactions. The balance of payment of a country may be deficit or surplus. A deficit occurs when the receipt fall short of payments to be made to other countries. In opposite case they have a surplus in her balance of payments.

The balance of trade is the difference in value over a period of time between a country's imports and exports of goods and services, usually expressed in the unit of currency of a particular country
While the balance of payments (the sum total of all economic transactions between one country and its trading partners around the world), which includes capital movements (money flowing to a country paying high interest rates of return), loan repayment, expenditures by tourists, freight and insurance charges, and other payments.

Balance of trade (BOT) is the difference between  visible improts and visible exports in monetary terms. Correction should be made to the effect that BOT can be in deficit or surplus state depending on how a country's imports compares to its exports. It should be noted that BOT is just a component of the balance of payment (BOP) which records all transactions between a country and other countries.  Abson