The ever widening current account deficit could be held responsible for which of the following probl...........

Economic Affairs Balance of Payments

Download Solution PDF

The ever-widening current account deficit could be held responsible for which of the following problems?

1) Fall of the domestic currency in the foreign exchange market

2) Stock Market crash

3) Inflation

4) Fiscal deficit

Select the correct statement/s using codes given below.

1, 2 and 4

2 and 3

1, 3 and 4

1, 2, 3 and 4

छोटे Courses बड़े Results

Master Balance of Payments

Prepare through Micro-courses

Try Now

Explanation:

All the statements are correct.

The current account deficit is a measurement of a country’s trade where the value of the goods and services it imports exceeds the value of the products it exports. The current account includes net income, such as interest and dividends, and transfers, such as foreign aid, although these components make up only a small percentage of the total current account. The current account represents a country’s foreign transactions and, like the capital account, is a component of a country’s balance of payments (BOP).