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Question : 5
Total: 52
As per the Reserve Bank of India (RBI) press report, dated 22 nd
"Net Foreign Portfolio Investment (FPI) recorded an outflow of US$ 15.2
The above transaction will be recorded in the _______ account on _______ side of Balance of payments account of India. (Choose the correct alternative)
"Net Foreign Portfolio Investment (FPI) recorded an outflow of US
The above transaction will be recorded in the _______ account on _______ side of Balance of payments account of India. (Choose the correct alternative)
Solution:
capital, debit
Explanation: Foreign portfolio investment is part of capital account of BOP as it affects the assets of a country. While outflow of foreign currency is recorded as debit (negative) item in BOP. Since, it reduces the country's capital account balance.
Explanation: Foreign portfolio investment is part of capital account of BOP as it affects the assets of a country. While outflow of foreign currency is recorded as debit (negative) item in BOP. Since, it reduces the country's capital account balance.
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