CUET Economics 2026 23rd May Shift 1 PYQs

Official reserve transactions are made to bridge the gap in the Balance of Payment (BoP), they are seen as the ________ item in the BoP.

Arrange the given statement in terms of determining the ehange rate through a floating /flexible exchange rate.

(A) Depreciation of domestic currency in terms of foreign currency.

(B) The demand curve shifts upward and right to the original demand curve.

(C) The demand for foreign goods and services increases.

(D) The increase in demand for foreign goods and services result in a change in the exchange rate.

Choose the correct answer from the options given below:

It is difficult to record all international transactions accurately. Thus, there is a third element of Balance of Payment (BoP) (apart from the current and capital accounts) which adjusts inaccuracies to some extent that is called:

1. Reserves Change
2. Overall Balance
3. Errors and Omissions
4. Other Flows