I’m finding myself hung up on the distinction between the two of these (econ is my weakest subject to begin with) and I feel like this is an easier area to lock in an extra point. Is there any easy distinction between the two?
Current account = X-M = net export of goods, services, unilateral transfers, income receipts.
Capital account = transfers of non-financial, non-produced assets (patents, natural resources) + capital transfers (eg. migrant transfers)
Financial account = foreign securities, currencies, direct investments.
x-m is trade balance current account is trade balance and net foreign income (earnings on foreign assets minus payment to foreign investor) balance of payments consists of Current account, capital account and financial account if you havr CA deficit, you want capital account to fund this. thru direct investment or portfolio. financial account is govt assets: fx reserves, SDR in IMF