Question : Which of the following is a capital account transaction?
Option 1: Exporting goods and services
Option 2: Making a foreign direct investment
Option 3: Receiving income from a foreign investment
Option 4: Paying for foreign aid
Correct Answer: Making a foreign direct investment
Solution : The correct answer is (b) Making a foreign direct investment
A capital account transaction refers to the movement of financial capital between countries. It involves the acquisition or disposal of non-financial assets, such as foreign direct investment, financial derivatives, and changes in ownership of fixed assets.
Option 1: Receiving foreign aid
Option 3: Exporting goods and services
Option 4: Borrowing from a foreign bank
Option 1: Buying goods and services from a foreign country
Option 2: Receiving foreign aid
Option 3: Making a foreign direct investment
Option 4: Earning income from a foreign investment
Question : Which of the following is not an example of a current account transaction?
Option 1: Investing in foreign stocks
Option 2: Exporting goods and services
Option 3: Receiving income from foreign investments
Option 2: Paying for foreign aid
Question : Which of the following is an example of a capital account transaction?
Option 1: Importing goods and services from another country
Option 2: Exporting goods and services to another country
Option 3: Buying foreign stocks and bonds
Option 4: Receiving foreign aid
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile