Question : Which of the following is not a current account transaction?
Option 1: Foreign direct investment
Option 2: Export of goods and services
Option 3: Transfer payments
Option 4: Income from foreign investments
Correct Answer: Foreign direct investment
Solution : The correct answer is (a) Foreign direct investment
Foreign direct investment (FDI) is not a current account transaction. FDI is a capital account transaction, as it involves the acquisition or establishment of long-term assets, such as businesses or property, in a foreign country. It represents an investment in the real sector of the economy and is recorded in the capital account of the balance of payments.
Option 1: Import of goods and services
Option 4: Foreign direct investment
Question : Which of the following is not a type of financial account transaction?
Option 2: Portfolio investment
Option 3: international borrowing
Option 4: Export of goods and services
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 4: Paying for foreign aid
Question : Which of the following is not included in the current account of the BoP?
Option 1: Imports and exports of goods and services
Option 2: Income from foreign investments
Option 3: international transfers and gifts
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
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile