| Which of the following are the contributors for the decline of Current Account Deficit (CAD)? |
| 1. Restrictions on non-essential imports |
| 2. Currency Swap Agreement of RBI |
| 3. Demand slowdown |
| 4. Increase in exports. |
| Select the correct answer using the codes given below: |
A) 1, 2 and 3 only
B) 2, 3 and 4 only
C) 2 and 3 only
D) 1, 2, 3 and 4
Correct Answer: D
Solution :
[d] A current account deficit means the value of imports of goods / services / investment incomes is greater than the value of exports. It is sometimes referred to as a trade deficit. Though a trade deficit (goods) is only part of the current account. [Current account deficit is estimated to be around 1.5 per cent of the GDP in the current fiscal (2016), helped by sharp fall in oil prices even as gold imports rose in the past few months, the Reserve Bank said in June 2015]
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