Discuss why the current account is used as a better account to assess the stability of the economy?

Question: Discuss why the current account is used as a better account to assess the stability of the economy?

The current account is often used as a better account to assess the stability of an economy because it provides a comprehensive measure of a country's international trade and financial transactions. It includes exports and imports of goods and services, income earned from abroad, and transfers, such as remittances from overseas workers. A positive current account balance, or a surplus, indicates that a country is exporting more than it is importing, which can be a sign of a competitive economy. On the other hand, a negative current account balance, or a deficit, can indicate that a country is importing more than it is exporting, which can be a sign of an uncompetitive economy. Therefore, the current account can provide valuable information about the health and stability of an economy's international transactions, which can be useful in assessing its overall economic performance.

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