Question : An increase in import payments leads to a _____________in the current account balance.

Option 1: decrease

Option 2: surplus

Option 3: stability

Option 4: increase

Question : A decrease in tourism receipts leads to a _____________in the current account balance.

Option 1: increase

Option 2: decrease

Option 3: surplus

Option 4: deficit

Question : When a country's current account surplus increases, its capital account balance is likely to:

Option 1: Increase

Option 2: Decrease

Option 3: Remain unchanged

Option 4: It is not related to the current account surplus

Question : Which of the following is not a type of balance of payments surplus or deficit?

Option 1: Trade surplus or deficit

Option 2: Current account surplus or deficit

Option 3: Capital account surplus or deficit

Option 4: Service account surplus or deficit

Question : If a country experiences an increase in its foreign exchange reserves, it indicates:

Option 1: A surplus in the current account

Option 2: A deficit in the current account

Option 3: A surplus in the capital account

Option 4: A deficit in the capital account

Question : Assertion: An increase in import payments leads to an unfavorable balance of payments.

Reason: Higher import payments contribute to a deficit in the current account.

Option 1: Both Assertion and Reason are true and correct explanation

Option 2: Both Assertion and Reason are true and incorrect explanation

Option 3: Assertion is true but Reason is false

Option 4: Assertion is false but Reason is true