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Question : Which of the following is not a component of the current account in the Balance of Payments?

Option 1: Exports of goods

Option 2: Imports of goods

Option 3: Remittances from overseas workers

Option 4: Foreign direct investment


Team Careers360 24th Jan, 2024
Answer (1)
Team Careers360 25th Jan, 2024

Correct Answer: Foreign direct investment


Solution : The correct answer is (d) Foreign direct investment.

Foreign direct investment (FDI) is not a component of the current account in the Balance of Payments. It is part of the capital and financial account. The current account records transactions related to the trade in goods, trade in services, income flows, and unilateral transfers.

Therefore, foreign direct investment (FDI) is not part of the current account but is recorded in the capital and financial account of the Balance of Payments.

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