Indiana Social Studies GE.4.5
The Standard
Discuss the components that make up the balance of payments and balance of trade among nations.
2026 Indiana Academic Standards: K-12 Social Studies
Teacher's field guide
What This Standard Means
What Students Need to Do
- Students calculate a goods trade balance by subtracting imports from exports. They sort payments between countries into the current, capital, and financial accounts. They recognize that the wider record includes services, income, transfers, and investments.
What Mastery Looks Like
- Given $80 in goods exports and $100 in goods imports, a student finds a $20 trade deficit. They place tourism earnings and remittances in the current account, debt forgiveness in the capital account, and foreign bond purchases in the financial account. They can explain how investment inflows can offset a trade deficit.
Common Misconceptions
- Students may assume a trade deficit means the entire balance of payments is negative. They may count a foreign purchase of domestic bonds as an export or leave tourist spending out of the current account.
How to Assess It
- Exit ticket: A country exports $80 in goods and imports $100, earns $10 from foreign tourists, has $5 of debt forgiven, and sells $20 in bonds to foreign buyers. Find the goods trade balance and name the account for each remaining item.
Lesson moves
Ways to Teach It
Give pairs paper invoices for $80 in exports and $100 in imports; have them stack the invoices and calculate the trade balance.
Ask, 'Can a country have a goods trade deficit and still receive money from abroad? Explain using a foreign bond purchase.'
Play four-corner account sort with printed cards showing tourist spending, remittances, debt forgiveness, and foreign bond purchases.
Show a phone import invoice and a foreign purchase of U.S. Treasury bonds; mark each entry on a two-column chart.
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- GE.4.6
Evaluate the effects of trade agreements among nations and barriers to trade.
- 6.E.3
Explain why international trade requires a system for exchanging currency between various countries.
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