FAVORABLE BALANCE OF PAYMENTS: An imbalance in a nation's balance of payments in which payments made by the country are less than payments received by the country. This is also termed a balance of payments surplus. It's considered favorable because more currency is flowing into the country than is flowing out. Such an unequal flow of currency will expand the supply of money in the nation and subsequently cause a decrease in the exchange rate relative to the currencies of other nations. This then has implications for inflation, unemployment, production, and other facets of the domestic economy. A balance of trade surplus is often the source of a balance of payments surplus, but other payments can turn a balance of trade surplus into a balance of payments deficit.

     See also | balance of payments | money supply | currency | foreign exchange market | exchange rate | balance of payments deficit | balance of trade surplus | international finance |

FAVORABLE BALANCE OF PAYMENTS, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2018. [Accessed: July 20, 2018].

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A way of looking at and analyzing the way the world works by comparing the cost of an action with the benefit generated. The study of economics is the process of economic thinking about issues related to the scarcity problem.

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