13th and 14th question of Eco
Dear Student,
Answer 13 :-
(a) Transfer of funds to relatives abroad: It is recorded in the current account because it does not change any liability or an asset. It is recorded on debit side because it leads to outflow of foreign exchange.
(b) Imports of machinery: It is recorded as visible items in the current account because it does not change any liability or an asset. It is recorded on debit side because it leads to outflow of foreign exchange.
(c) Interest on loan received from Nepal : It is recorded as positive item in the capital account of the BOP, as it results in an inflow of the foreign exchange into the country.
(d) Import of Mobile phones from China :- It is recorded as negative items in the Current Account of BOP, as it results in an outflow of the foreign exchange from the country.
Note: Please ask next question in different thread. Keep Asking!
Regards
Answer 13 :-
(a) Transfer of funds to relatives abroad: It is recorded in the current account because it does not change any liability or an asset. It is recorded on debit side because it leads to outflow of foreign exchange.
(b) Imports of machinery: It is recorded as visible items in the current account because it does not change any liability or an asset. It is recorded on debit side because it leads to outflow of foreign exchange.
(c) Interest on loan received from Nepal : It is recorded as positive item in the capital account of the BOP, as it results in an inflow of the foreign exchange into the country.
(d) Import of Mobile phones from China :- It is recorded as negative items in the Current Account of BOP, as it results in an outflow of the foreign exchange from the country.
Note: Please ask next question in different thread. Keep Asking!
Regards
