CUET Economics: MacroBalance of Payments. Free, no login required.

Identify the correct statements with respect to current account:

A. Balance of trade is the difference between export and import of goods in given period of time.

B. Current account records all international transactions of assets.

C. Trade in services includes factor income and non-factor income transactions.

D. Current account is in balance when capital inflows are equal to capital outflows.

Choose the correct answer from the options given below:

Which of the following statements are correct in respect to Balance of payment?

A. Exports of goods are entered on debit side.

B. Transfer payments are receipts without rendering any services in return.

C. Capital account includes external borrowings.

D. Net invisibles are the part of current account.

Choose the correct answer from the options given below:

Which one of the following statements is correct about the balance of payment (BOP)?

Which one of the following is the major advantage of flexible exchange rate system?

When transactions are made due to some reason other than to bridge the gap in the balance of payments, that is, when they are independent of the state of BoP then such international economic transactions are called as..........................

Under which of the following exchange rate systems appreciation and depreciation take place in the exchange rate?

Arrange the following statements about the effect of change in demand for foreign goods on foreign exchange rate in open economy in correct sequence.

(A) It leads to a shift in the demand curve towards right.

(B) More Rupee needed against a dollar.

(C) Demand for foreign goods and services increases in the economy.

(D) It leads to depreciation of the domestic currency in terms of dollars.

Choose the correct answer from the options given below:

"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).

The price of one currency in terms of another currency is called?

Match List-I with List-II

Choose the correct answer from the options given below:

The reserve bank sells foreign exchanges when there is a deficit in the balance of payment. This sale is called?

In a fixed exchange rate system, the government's action that increases the exchange rate of foreign currency is called?

The price of one currency in terms of another currency is known as the:

The difference between the value of exports and the value of imports of goods of a country in a given period of time is known as:

When the government increases the exchange rate of domestic currency in terms of foreign currency(by making domestic currency costlier year) in a fixed exchange rate system, that increase called:

A country's balance of payment account is in surplus when?

Match the LIST-I with LIST-II

Choose the correct answer from the options given below:

Calculate the current account balance from the information given below:

Exports = 400 crores

Imports = 750 crores

Net Invisibles

Income = - 60 crores

Transfer = 90 crores

When the country purchase the goods and services from rest of the world, this is called:

Under dirty floating system, central banks intervene to buy and sell foreign currencies in an attempt to moderate exchange rate movements whenever they feel that such actions are appropriate. Therefore, official reserve transactions are:

From the given data, find out the Current Account Balance.

Which of the following is not a component of capital account ?

In a fixed exchange rate system, when the government increases the value of foreign currency, this change is called:

A mixture of a flexible exchange rate system (the float part) and a fixed rate system (the managed part) is called:

Which one of the following represents the dirty floating exchange rate system?

Select the third element of BOP other than current and capital accounts.

Arrange the following in correct sequence with respect to the effect on exchange rate under flexible exchange rate system.

A. There is increase in the demand for foreign trips.

B. Depreciation of domestic currency.

C. Higher demand for foreign exchanges.

D. Shift in the demand curve to the right.

Choose the correct sequence from the options given below:

Choose the correct statement regarding components of Balance of Payment.

A country could use its reserves of foreign exchange in order to balance any deficit in its balance of payments. The reserve bank _________ foreign exchange when there is a deficit. This is called __________.

International economic transactions are called _______________ when transactions are made due to some reason other than to bridge the gap in balance of payments.