HSC Together Year 12 Economics: Effects of these Trends on Australia’s Balance of Payments: Causes of the CAD

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Effects of these Trends on Australia’s Balance of Payments: Causes of the CAD

Since the Current Account is comprised of the Balance of Goods and Services (BOGS) and Net Primary Income (NPY) accounts, it is important to see how trends in the BOGS and NPY account will affect the overall Balance of Payments.

Australia suffers from a persistent Current Account Deficit (CAD) due to outflows in the Current Account exceeding inflows. This is directly caused by the NPY and BOGS balances.

Watch the videos to learn how the NPY affects the size of the CAD in HSC Economics:

Watch the videos to learn how the BOGS affects the size of the CAD in HSC Economics:

Want to learn more? Check out more of our HSC Economics resources here!

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