Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Macro Economics: Open Economy Macro Economics

Question:

What are the major components of capital Account among the following?

(A) Bank Deposits
(B) Investment
(C) External Borrowings
(D) External Assistance

Choose the correct answer from the options given below :

Options:

(A), (B), (C) & (D) Only

(B), (C) & (D) Only

(A), (C) & (D) Only

(A), (B) & (C) Only

Correct Answer:

(B), (C) & (D) Only

Explanation:

The capital account in the balance of payments typically includes items related to financial transactions that involve changes in ownership of assets. Among the options provided:

(A) Bank Deposits - This is not typically considered a component of the capital account. Bank deposits are more related to the financial account.

(B) Investment - This is often a component of the capital account, especially foreign direct investment (FDI) and portfolio investment.

(C) External Borrowings - External borrowings are usually considered a part of the capital account.

(D) External Assistance - External assistance, such as aid or grants, is often included in the capital account.

So, the correct answer would be: (B), (C) & (D) Only