Question : Balance of payments consists of two main accounts: the current account and the ___________account.
Option 1: trade
Option 2: capital
Option 3: services
Option 4: investment
Correct Answer: capital
Solution : The correct answer is (b) capital
The balance of payments consists of two main accounts: the current account and the capital account. The current account records transactions related to the trade in goods and services, income flows, and current transfers between a country and the rest of the world. The capital account, on the other hand, records capital transactions, including financial investments, such as foreign direct investment and portfolio investment, as well as capital transfers. These two accounts together provide a comprehensive overview of a country's economic transactions with the rest of the world.
Question : The current account includes the balance of trade in goods, balance of trade in services, and balance of _______________transactions.
Option 1: capital
Option 2: financial
Option 3: investment
Option 4: current
Question : The balance of payments is divided into which three main components?
Option 1: Current Account, Capital Account, and Financial Account
Option 2: Exports, Imports, and Trade Balance
Option 3: Income, Savings, and Investments
Option 4: Domestic, Foreign, and External Accounts
Question : The balance of trade is a part of which account in the Balance of Payments?
Option 1: Current Account
Option 2: Capital Account
Option 3: Financial Account
Option 4: Reserve Account
Question : Which of the following is not a component of the current account?
Option 1: Merchandise trade balance
Option 2: Services trade balance
Option 3: Income balance
Option 4: Capital balance
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