Question : Which of the following is an example of a unilateral transfer in the current account?
Option 1: Exporting goods and services
Option 2: Receiving foreign aid
Option 3: Investing in foreign stocks
Option 4: Borrowing from a foreign bank
Answer (1)
20th Jan, 2024
Correct Answer: Receiving foreign aid
Solution : The correct answer is (b) Receiving foreign aid
Receiving foreign aid is an example of a unilateral transfer in the current account. Unilateral transfers represent one-way transfers of funds or assets without expecting anything in return. They are typically classified as part of the current account of the Balance of Payments (BoP).
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