Question

Name two items each relating to Current Account BoP and Capital Account BoP.

Answer 1

(i) Current Account BoP includes:

(a) Export and import of goods (called merchandise)

(b) Export and import of services (called invisibles)

(ii) Capital Account BoP includes:

(a) International sale and purchase of financial assets (like stocks and bonds), and

(b) International sale and purchase of real assets (like plant and machinery)