Question : Which of the following items is not included in the financial account of the Balance of Payments?
Option 1: Foreign direct investment
Option 2: Portfolio investment
Option 3: Official reserves
Option 4: Trade in goods and services
Correct Answer: Trade in goods and services
Solution : The correct answer is (d) Trade in goods and services.
The financial account of the Balance of Payments records transactions related to changes in a country's ownership of financial assets and liabilities with non-residents. It includes items such as foreign direct investment (FDI), portfolio investment, and official reserves.
Trade in goods and services: This is not included in the financial account. It falls under the current account of the Balance of Payments, which records transactions related to the trade in goods and services, income flows, and unilateral transfers.
Question : Which of the following is not a component of the financial account?
Option 3: Official reserve assets
Option 4: Current account balance
Option 3: international borrowing
Option 4: Merchandise trade balance
Question : The current account of the Balance of Payments includes:
Option 1: Trade in goods and services
Option 2: Financial transfers
Option 3: Capital transactions
Option 4: Foreign exchange reserves
Question : Which of the following is not a type of financial account transaction?
Option 4: Export of goods and services
Question : Which of the following is not a component of the capital account?
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