Excess of foreign exchange receipts over foreign exchange payments on account of accommodating transactions equals deficit in the balance of payments.

True

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False

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Solution

The correct option is B False
Excess of foreign exchange payments over foreign exchange receipts on account of autonomous transactions leads to deficit in the balance of payments.

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Similar questions

Unfavourable balance on current account leads to high receipts of foreign exchange in the capital account. Do you agree?

(a) How does giving incentives for exports influence Foreign Exchange Rate? Explain diagrammatically.

(b) How are the following transactions recorded in the balance of payment accounts? Give reasons.

(i) Foreign investment from abroad

(ii) Sale of machinery to abroad

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