Answer to Question #265998 in Finance for Robert

Question

Explain the causes of Balance of Payment disequilibrium in any country (10mks)

Answer 1

Solution:

The main cause of the disequilibrium in the balance of payments arises from imbalance between exports and imports of goods and services. When for one reason or another exports of goods and services of a country are smaller than their imports, disequilibrium in the balance of payments is the likely result.