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Answer» Difference Balance of Trade and Balance of Payments: | Sl. No | Balance of Trade (BOT) | Balance of Payments (BOP) | | i | Balance of trade is the difference between the money value of exports and imports of goods during a given period of time. | BOP is a systematic record of all the economic transactions of residents of a country with rest of world during a given period of time. | | ii | It includes only visible items. | It includes both visible and invisible items. | | iii | It’s a narrow concept as it is a part of balance of payment. | It’s a wider concept as it includes balance of trade in it. | | iv | It can be favourable, un- favourable or balance. | It is always balanced. | | v | It is not a true indicator of economic condition of a country. | It represents a better picture of a country’s economic condition than the balance of trade. |
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