UPSC General Studies Solved Paper - General Studies-2014

  • question_answer
    With reference to Balance of Payments, which of the following constitutes/constitute the Current Account?
    1. Balance of trade        
    2. Foreign assets
    3. Balance of invisibles   
    4. Special drawing rights
    Select the correct answer using the codes given below.

    A)  Only 1 

    B)  2 and 3

    C)  1 and 3           

    D)  1, 2 and 4

    Correct Answer: C

    Solution :

    Exp. [c] Foreign assets come under the category of capital account, while the SDRs are a type of foreign only. Thus, these two options are not a part of the current account. Balance of trade, on the other hand, is the net record of total imports and exports of the country, for the period under consideration.

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