Question : Which of the following is not a capital account transaction?
Option 1: Purchasing foreign stocks and bonds
Option 2: Making a foreign direct investment
Option 3: Borrowing from a foreign bank
Option 4: Buying goods and services from a foreign country
Correct Answer: Buying goods and services from a foreign country
Solution : The correct answer is d) Buying goods and services from a foreign country
Buying goods and services from a foreign country is not a capital account transaction. It is a transaction that falls under the current account of the Balance of Payments (BoP). The current account records the inflows and outflows of goods, services, income, and transfers between residents and non-residents.
Question : Which of the following is a capital account transaction?
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 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
Option 1: Receiving foreign aid
Option 3: Exporting goods and services
Option 4: Borrowing from a foreign bank
Option 1: Exporting goods and services
Option 3: Receiving income from a foreign investment
Option 4: Paying for foreign aid
Question : Which of the following transactions would result in a credit to the current account?
Option 1: Importing goods and services
Option 2: Exporting goods and services
Option 4: Making a foreign direct investment
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