Question

Which of the following can be included in the current account of the balance of payments?
(i) Purchase of goods from abroad
(ii) sale of services abroad
(iii) Worker's remittances from abroad
(iv) Sale of copyright to foreigners
(v) Direct investment in equity capital

• A. (i), (ii) and (iii)
• B. (i), (ii) and (iv)
• C. (i), (ii), (iii) and (v)
• D. (i), (ii), (iii) and (iv)

Answer 1

The correct option is A (i), (ii) and (iii)

The balance of payments account comprises of the current account and the capital account. The current account consists of the visible and invisible imports and exports of the country (such as purchase of goods from abroad and sale of services abroad) as well as unilateral transfers and income receipts and payments (such as worker remittances from abroad).