Distinguish between Current account and Capital account of Balance of

1.	Distinguish between Current account and Capital account of Balance of Payments.
Answer» Distinction between Current Account and Capital Account of Balance of Payment. (I) Current account includes import-export of goods and services and unilateral transfers from one country to other, while capital account includes all such transaction between residents of a country and rest of the World which cause a change in assets or liability status of the residents of a country and its residents. (II) Transaction in current account take place in the form of flow while in capital account it takes place as stock. (III) Transaction related to current account bring change in current income of the country while transaction related to capital account affect capital stock of the country.

Distinguish between Current account and Capital account of Balance of Payments.

Answer»

Distinction between Current Account and Capital Account of Balance of Payment.

(I) Current account includes import-export of goods and services and unilateral transfers from one country to other, while capital account includes all such transaction between residents of a country and rest of the World which cause a change in assets or liability status of the residents of a country and its residents.

(II) Transaction in current account take place in the form of flow while in capital account it takes place as stock.

(III) Transaction related to current account bring change in current income of the country while transaction related to capital account affect capital stock of the country.

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