The current account is the record of trade in goods and services and transfer payments. Arrange the following components in terms of service.

(A). Current account.
(B). Net factor income + Net Non-factor income.
(C). Net investment income + Net income from compensation of employees.
(D). Trade in services.

Choose the correct answer from the options given below:

(A), (D), (B), (C)

The correct answer is Option (4) → (A), (D), (B), (C)

(A) Current account. This is the broadest category, which includes trade in goods and services, net factor income, and net transfers.

(D) Trade in services. Within the current account, trade in services is one major component, including tourism, banking, transport, and IT services.

(B) Net factor income + Net Non-factor income. This includes income from abroad for use of factors of production (factor income) and unilateral transfers (non-factor income).

(C) Net investment income + Net income from compensation of employees. These are sub-components of net factor income — investment income includes interest, dividends, etc., while compensation includes wages earned abroad.