Question

Answer the following question.
State any two factors responsible for the inflow of foreign currency.

Answer 1

Factors which are responsible for inflow of foreign currency are:

1. A country receives foreign exchange from various receipts in economic transactions such as a receipt from exports of the domestic country to rest of the world, receipt of remittances from abroad, FDI, and purchase of financial assets in the domestic country.
2. The foreign exchange flows in the country due to speculative activities.