Answer to Question #73140 in Economics for Karnan

Question

If a country helps other country by means of goods, i understand. If a country helps other country by means of money, as the money is not valid in another country. How does the transaction happen?

Answer 1

International payments are always made in global (reserve) currency.
Some of the world's currencies are accepted for most international transactions. The most popular are the U.S. dollar, the euro, and the yen.