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
1. Select a data series that you wish to forecast. Make sure that it has some importance to you relative to business, future occupation or other special interest. Obtain monthly or

use a graphical illustration to describe briefly what the influence of each of the following be on the market supply of labour,(a) an increase in immigrants, (b) a reduction in wag

any village panchayat in west bengal and get information for doing a project.


In relation to solvency margins in the insurance industry, the solvency margin is the amount of regulatory capital an insurance undertaking is obliged to hold against unforeseen ev

Monopoly: Monopoly is a market structure in which there is a single firm producing a commodity or providing a service that has no close substitutes. As the sole supplier to it

Economic growth and Economic development: Economic Growth refers to an increase in real aggregate output (real GDP) reflected in increased real per capita income.A country is

Ask questMicroeconomics Reference No.:- #Minimum 100 words accepted#

if a commodity has limited demand , should economist say that we still have a scarcity ?

what is the application of consumer surplus