Saved Bookmarks
| 1. |
State any four items each of current account and capital account of the balance of payments account. |
| Answer» Solution :The MAJOR components of a current account are:The Balance of Trade (only visible ITEMS i.e. GOODS): Goods imported and exported to and from the country.Trading of Services: Services received from other countries and rendered to other nations.Net investment income: Income from foreign investment less payments on foreign investments.Net cash transfers: Current transfers in the form of donations, gifts, aids, etc. form PART of net cash transfer.The following are the components of Capital Account:Foreign Direct Investment: Investment and control in a company based in a country by a foreign company.Portfolio Investment: Investment in STOCKS, bonds, debts and other financial assets.Government loans to the Government of other countries of the world. | |