Question : Which of the following is not a component of the capital account?
Option 1: Foreign direct investment
Option 2: Portfolio investment
Option 3: international transfers and gifts
Option 4: Current account balance
Answer (1)
25th Jan, 2024
Correct Answer: Current account balance
Solution : The correct answer is (d) Current account balance
The current account balance is not a component of the capital account. The capital account and the current account are two separate components of the balance of payments (BoP) and represent different types of transactions.
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