CBSE 2021 Class 12 Economics Term 1 Paper

Question : 9

Total: 60

From the following statements, choose the correct statement:

Trade deficit refers to the excess of 'total value of exports' over the 'total value of imports' of goods and services.
Trade surplus refers to the excess of 'total value of imports' over the 'total value of exports' of goods and services.
Current account deficit in a nation occurs when the foreign exchange receipts in current account fall, short of foreign exchange payments in current account.
Current account surplus in a nation occurs when the credit items of Balance of Payments are less than the debit items of Balance of Payments.

Solution:

(c) Current account deficit in a nation occurs when the foreign exchange receipts in current account fall, short of foreign exchange payments in current account.
Explanation: Current account deficit in a nation occurs when the value of imports is greater than the value of exports or as the given statement says when the foreign exchange receipts in current account fall short of foreign exchange payments in current account.

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