Difference b/w:
1. BOT & BOP
2. BOT & balance on current account
3. current account & capital account
(please answer in points.(3-4marks))
Solution (i)
The answer to the concerned question has been covered in our study material. You can find it at the below mentioned link.
Solution (ii)
Basis of difference | Balance of Trade | Balance on Current Account |
Meaning | Balance of Trade is the record of visible transactions of the country. | It is a record of the visible as well as invisible and unilateral transactions. |
Components | It is the balance of exports and imports of all physical goods of the country. | It is the balance of visible trade, invisible trade and unilateral transfers. |
Nature of transactions | It records the transactions relating to physical goods only. | It records the transactions relating to goods, services as well as unilateral transactions. |
Solution (iii)
Basis of difference | Current Account | Capital Account |
Meaning | The Current Account maintains the records of imports and exports of goods and services as well as the record of unilateral transfers. | The Capital Account records all the transactions that cause a change in the status of assets and liabilities of the government or any of the residents of a country |
Components | Components are: 1. Export and Import of goods 2. Export and Import of services 3. Unilateral Transfers | Components are: 1. FDI and Portfolio Investment 2.Loans and borrowings 3.Banking Capital transactions |