Question : Which of the following is not a component of the current account?
Option 1: Trade in goods
Option 2: Trade in services
Option 3: Factor income
Option 4: Portfolio investment
Answer (1)
23rd Jan, 2024
Correct Answer: Portfolio investment
Solution : The correct answer is (d) Portfolio investment
Portfolio investment is not a component of the current account of the Balance of Payments (BoP). It is a financial account transaction that involves the purchase or sale of financial assets, such as stocks and bonds, between residents and non-residents.
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