Assertion A Export of goods and services from India to US would mean outflow of foreign ex...........

Economics (CUET) Balance of Payments

Assertion (A): Export of goods and services from India to US would mean outflow of foreign exchange from India.

Reason (R): Foreign exchange in terms of receipts for exports flows from US to India.

Both Assertion (A) and Reason (R) are true, and Reason (R) is the correct explanation of the Assertion (A).

Both Assertion (A) and Reason (R) are true, but Reason (R) is not the correct explanation of the Assertion (A).

Assertion (A) is true, but Reason (R) is false.

Assertion (A) is false, but Reason (R) is true.

Let’s break this down:

- Assertion (A): Export of goods and services from India to US would mean outflow of foreign exchange from India.

- This isn’t accurate. When India exports, the money actually flows into India. India is earning foreign exchange, not losing it.

- Reason (R): Foreign exchange in terms of receipts for exports flows from US to India.

- This is spot on. The US pays India for the goods and services, so foreign exchange comes into India.

Let’s look at the options:

- Option 1: Both are true, and R explains A — Not right, because A is false.

- Option 2: Both are true, but R doesn’t explain A — Still not right, A is false.

- Option 3: A is true, but R is false — Nope, it’s the other way.

- Option 4 (): A is false, but R is true — This matches what’s going on.

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