Question 9
POST_UTME_EKSU
•
2022
•
ECONOMICS
•
objective
A country's balance of payments is in equilibrium when its current account is equal to its capital account. Explain why this is the case.
Answer Options
Correct Answer
A.
The current account and capital account are equal because the country's imports and exports are balanced, and the country's foreign investment and foreign borrowing are also balanced.
B.
The current account and capital account are equal because the country's GDP is equal to its national income, and the country's savings are equal to its investment.
C.
The current account and capital account are equal because the country's trade deficit is equal to its trade surplus, and the country's foreign investment is equal to its foreign borrowing.
D.
The current account and capital account are equal because the country's imports are equal to its exports, and the country's foreign investment is equal to its foreign borrowing.
Correct Answer
A
Correct Option:
The current account and capital account are equal because the country's imports and exports are balanced, and the country's foreign investment and foreign borrowing are also balanced.
About This Question
This is
Post Utme Eksu
2022
Economics
Question 9.
It is one of the
objective
questions from the
2022
Post Utme Eksu
Economics
examination.