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"When it is difficult to record all international transactions accurately, then a third element of BOP (apart from the current and capital accounts) is used." Identify the third reflector of Balance of Payments (BOP).

Solution

✅ Correct Option: 1

Since it is difficult to record all international transactions accurately, the balance of payments includes a third element called errors and omissions, which reflects the discrepancies that remain after recording the current and capital accounts.

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