ECONOMICS (CBSE/UGC NET)

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ECONOMICS

BALANCE OF PAYMENTS

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
Which of the following is a major subaccount of the Balance of Payments? (you can tick more than one)
A
the financial account
B
the accounts payable
C
the capital account
D
the current account
Explanation: 

Detailed explanation-1: -The balance of payments divides transactions into two broad accounts: the current account. the combined capital and financial account.

Detailed explanation-2: -The Current Account When combined, goods and services together make up a country’s balance of trade (BOT). The BOT is typically the biggest bulk of a country’s balance of payments as it makes up total imports and exports.

Detailed explanation-3: -There are three components of the balance of payment viz current account, capital account, and financial account. The total of the current account must balance with the total of capital and financial accounts in ideal situations.

Detailed explanation-4: -Detailed Solution. Current Account of Balance of payments does not include Investments. Current Account of Balance of payment is the sum of Balance of Trade, NetFactor income & Net Transfer payment.

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