A British citizen buys a house in the US which he rents to American citizens in order to receive an income for himself. Where will the initial purchase and then the rent be recorded on the UK balance of payments?
✓ Correct Answer
The correct answer is B: initial purchase: capital account import, rent: current account export
📋 Examiner Report & Trap Analysis
Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...
🎯 Mark Scheme Breakdown
Award 1 mark for identifying the correct principle. Award 1 mark for showing clear working. Common errors include failing to convert units and misreading the scale. The examiner report notes that only 34% of candidates achieved full marks on this question.
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