Capital account, Microeconomics

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.

Posted Date: 11/15/2012 12:21:53 AM | Location : United States







Related Discussions:- Capital account, Assignment Help, Ask Question on Capital account, Get Answer, Expert's Help, Capital account Discussions

Write discussion on Capital account
Your posts are moderated
Related Questions
Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4


Regardless of the market structure, oligopolist and the monopolist maximize their TR when MR=0. Do you agree?

Let Consider the following insurance market. There are two states of the world, B and G , and two types of consumers, H and L, who have probabilities p H =0.5 and p L

(a) Reasons of Urban Growth (b) Characteristics of Urban Growth (c) Economic Life of a Building (d) Zone of Transition (e) Location Theory (f) Patterns of Growth Theory (g) Growth

Question 1: (a) Describe what is Economic growth and describe its relationship with standard of living? (b) Assuming you are the government economist, what policy measures

THEORY OF COSUMER  BEHAVIOUR: BASIC THEMES: We elaborated two classical theories (viz. Cardinal Approach and Ordinal Approach). In ordinal approach discussing the indifference

Differentiate between oscillation and damp cobweb model


compare traditional modern and engineering cost curves