Sales of shares of an Indian company to a Chinese customer is a ______ item on the ______ of Balance of Payments.

  1. a) Debit, Capital account.
  2. b) Debit, Current account.
  3. c) Credit, Capital account.
  4. d) Credit, Current account.

Answer b: Debit, Current account.

Explanation: Since the sale of shares made by a Chinese customer is a debit (negative) item where the money will flow outside the country and the current accounts that record the changes in the country’s net income.

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