BALANCE OF PAYMENTS DEFICIT: An imbalance in a nation's balance of payments in which payments made by the country exceed payments received by the country. This is also termed an unfavorable balance of payments. It's considered unfavorable because more currency is flowing out of the country than is flowing in. Such an unequal flow of currency will reduce the supply of money in the nation and subsequently cause an increase 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 deficit is often the source of a balance of payments deficit, but other payments can turn a balance of trade deficit into a balance of payments surplus.

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

BALANCE OF PAYMENTS DEFICIT, AmosWEB GLOSS*arama, http://www.AmosWEB.com, AmosWEB LLC, 2000-2022. [Accessed: May 21, 2022].

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The numerical value of the slope of the production possibilities curve, which illustrates the alternative combinations of two goods that an economy can produce with given resources and technology, is the opportunity cost of producing the good measured on the horizontal axis.

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