The term ‘external sector’ refers to:
Answer & explanation
Correct answer: option 3
The correct answer is Option (3) → the economic transactions of a country with the rest of the world
The external sector means a country’s economic dealings with the rest of the world: trade in goods and services, and transactions in assets. Trade between states of one country is internal.
NCERT (2026-27): Glossary: “External sector – It refers to the economic transaction of the domestic country with the rest of the world.” |