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
Answer (1)
9th Jan, 2024
Correct Answer: Capital balance
Solution :
The correct answer is (d) Capital balance.
The capital balance, also known as the financial account, is a separate component of the balance of payments. It records the flows of financial assets and liabilities between a country and the rest of the world, including foreign direct investment, portfolio investment, and changes in reserve assets.
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