Question : Which of the following is not a current account transaction?
Option 1: Foreign direct investment
Option 2: Export of goods and services
Option 3: Transfer payments
Option 4: Income from foreign investments
Answer (1)
22nd Jan, 2024
Correct Answer: Foreign direct investment
Solution : The correct answer is (a) Foreign direct investment
Foreign direct investment (FDI) is not a current account transaction. FDI is a capital account transaction, as it involves the acquisition or establishment of long-term assets, such as businesses or property, in a foreign country. It represents an investment in the real sector of the economy and is recorded in the capital account of the balance of payments.
Comments (0)
Related Questions
Trending Articles/News
