Economic Awareness - Sectors of Indian Economy
Which of the following is included in the Current Account of the Balance of Payments?
Which of the following is included in the Current Account of the Balance of Payments?
easy Q1 of 15
Step-by-Step Solution
Step 1: Understand the components of the Current Account
The Current Account includes trade in goods and services, net income from abroad (such as interest and dividends), and current transfers.Step 2: Analyze each option
Interest payments on foreign loans are part of net income from abroad, thus recorded in the Current Account. Purchase of shares by foreign investors is a financial account transaction. Debt forgiveness is a capital transfer in the Capital Account. Sale of patents is a capital account transaction involving non-produced assets.Final Answer:
Interest payments on foreign loans → Option BQuick Check:
Interest payments on foreign loans = correct ✅
Quick Trick: Net income flows belong to Current Account.
Common Mistakes:
MISTAKES- Confusing financial transactions with current income flows.
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