Multiple Choice Questions on Factors not Influencing CAD of Country ........ for UPSC EPFO Exam Preparation

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General Accounting Principles

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    Factors not Influencing CAD of Country  

    Savings Rate 

    Incorrect Answer

    Natural Resources  

    Incorrect Answer

    Consumer spending

    Incorrect Answer

    Capital inflows

    Correct Answer
    Explanation:

    - Savings Rate: Impacts CAD as higher savings can lead to lower imports and reduced deficits.

    - Natural Resources: Their presence or absence can influence trade balance and thereby the CAD through exports.

    - Consumer Spending: Drives demand for imports, impacting the CAD.

    - Capital Inflows: ?? Does not directly influence CAD, but affects the financial account of the balance of payments rather than the current account itself.

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