Capital account, Microeconomics

Assignment Help:

Capital Account:

The Capital Account presents transfers of money and other capital items and changes in the country's foreign assets and liabilities resulting from the transactions recorded in the current account. The deficit on the current account and on account of capital transactions can be financed by external assistance (loans and grants) drawing from the International Monetary Fund and allocation of the Special Drawing Rights.  The BOP accounts provide a link between the increase in gross external debt and the portfolio and spending decisions of the economy. Thus, increase in gross external debt =  current account deficit (CAD) 

-  direct and long-term portfolio capital inflows 

+ official reserve increases 

+  other private capital outflows 

The above equation shows that an increase in external debt can have three broad sources: current account deficits not financed by long-term capital inflows, borrowing to finance a reserve build-up or private outflows of capital.


Related Discussions:- Capital account

Define why prices is significant for economy, Define why prices is signific...

Define why prices is significant for economy Reason for using different weights is that some prices are more significant than others for economy. Price of gasoline, for instanc

Determinants of private demand - gender , Determinants of Private Demand - ...

Determinants of Private Demand - Gender Hypothetically, let us consider a family with two children, a boy and a girl. Let it be that both of them qualify in an entrance exami

Determine the consumer surplus and the average price per cup, Suppose the d...

Suppose the demand curve for a consumer for coffee is: Q = 6 – 2P, where Q represents the number of cups per day and P is the price of coffee per cup.  Question: Sppose the co

Find the total cost and marginal cost function, Question : (a) Suppose...

Question : (a) Suppose Firm A is a perfectly competitive firm producing good X and faces the following average revenue and average cost Average Revenue: P = 10 Average Co

Indifference curve, Demonstrate mathematically that the equilibrium condit...

Demonstrate mathematically that the equilibrium condition MRS  PB PA is the equivalent of the utility-maximizing rule MU AP A  MU B PB .

Statistics, define statistics in plural and singular sense

define statistics in plural and singular sense

Market structures, discuss the implications of various market structures(co...

discuss the implications of various market structures(competitive and non-competitive) for price determination

Demand supply and price, Ask question # The price of Canadian-grown peaches...

Ask question # The price of Canadian-grown peaches skyrockets during an unusually cold summer that reduces the size of the peach harvest. b. An increase in income leads to an incr

Arbitrage pricing theory, Arbitrage Pricing Theor y Arbitrage ...

Arbitrage Pricing Theor y Arbitrage defines the procedure of continuously buying a security for privacy, currency, or commodity on one market and selling it in another

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd