Balance of Trade

Balance of Trade is known as the visible balance. This is the relationship between a country's payments  for imports of goods and its reciepts from the export of goods. In other words, Balance of Trade means only the balance between merchandiser trade or visible trade i.e imports and exports of goods. If the value of imports exceeds  the value of exports, we say that the balance of trade is "unfavorable" or is deficit. This debit balance is also known as the trade gap. If the value of exports exceeds the value of imports, we say the balance oftrade is  "favorable" or surplus.