Balance of Payments (BOP)

Balance of payments, also known as international balance of payments, is a big thing to calculate, so brace yourself to think big. It's a statement, including all the transactions between entities in a country, and between that country and other counties, per quarter. So, yeah it's a pretty big list.

This is compiled for the purposes of designing national and international economic policies. Say one country really needs investors in a certain area. They could write a policy, for instance lower share prices, to coax investors to that area. The policy writers know this is an area that needs help, based on the balance of payments statement. If a country can't fund their imports via exports, it will eventually run through its reserves, known as balance of payments deficit.