Question : Which of the following is not a component of the current account in the balance of payments?
Option 1: Goods and services
Option 2: Income from abroad
Option 3: Capital flows
Option 4: financial account
Correct Answer: Capital flows
Solution : The correct answer is (c) Capital flows
The current account in the balance of payments includes the components of goods and services, income from abroad, and current transfers. Capital flows, on the other hand, are recorded in the financial account of the balance of payments. Capital flows capture the movement of financial assets between countries, such as foreign direct investment, portfolio investment, and loans.
Option 4: Financial account
Option 3: Transfer payments
Option 4: Capital flows
Option 1: Exports of goods and services
Option 2: Imports of goods and services
Option 3: Income from abroad
Question : Which of the following is not a component of the current account?
Option 1: Balance of trade in goods and services
Option 2: Net income from abroad
Option 3: Net transfer payments
Option 4: Net capital inflows
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