KEY QUESTION Alpha’s balance-of-payments data for 2006 are shown below. All figures are in billions of dollars. What are the (

a) balance on goods, (

b) balance on goods and services, (

c) balance on current account, and (

d) balance on capital and financial account? Suppose Alpha needed to deposit $10 billion of official reserves into the capital and financial account to balance it against the current account.

Does Alpha have a balance-of-payments deficit or surplus?

Explain.

Goods exports $40 Goods imports 30 Service exports 15 Service imports 10 Net investment income 5 Net transfers 10 Balance on capital account 0 Foreign purchases of Alpha assets 20 Alpha purchases of assets abroad 40