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

Help to solve a assignment, Consider a market with short run demand and Sup...

Consider a market with short run demand and Supply functions. Qd=4-p^2, Q''s=4p-1.Find the partial market equilibrium, calculate consumer and producer surplus at this equilibrium,

Economic reforms and reduction of regional disparities, Economic Reforms an...

Economic Reforms and Reduction of Regional Disparities: Another important objective of development is to reduce regional disparities. Government has been helping the backward

Economic reforms and infrastructure growth, Economic Reforms and Infrastruc...

Economic Reforms and Infrastructure Growth Infrastructure data for the pre-reform period (1980-81 to 1990-91) is with1980-81 as base year and for post-reform period (1993-94 t

Sources of economic growth, Sources of Economic growth: Human resourc...

Sources of Economic growth: Human resources: Investment in human capital is considered as an important factor for economic growth. This is done by increasing the quality of

Chemical combination, Draw a diagram to show the type of bond between two f...

Draw a diagram to show the type of bond between two flourine atom

Oligopoly, characteristics and models of oligopoly by Sweezy,cournot and ed...

characteristics and models of oligopoly by Sweezy,cournot and edgework

Environmental effects of the use of robots in factories, A 1500 word resear...

A 1500 word research paper on the economic, social or environmental effects of the widespread use of robots in factories (this meets Learning Outcome 4)

Proportion of income spent for the commodity , All other things equivalent,...

All other things equivalent, the higher the proportion of income spent for the commodity more price elastic will be the demand.   Most home owners are recognizable with how this de

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