Distinguish between an autonomous transaction and accommodating transactions of the balance of payments account.
Autonomous transactions and Accommodating transactions
|Autonomous transactions||Accommodating transactions|
|Autonomous transactions are independent of the state of balance of payments account (BOP A/c)||An accommodating transactions are undertaken to maintain the balance in BOP account|
|These transactions take place on both current and capital accounts.||These transactions take place only on capital account|
|These items in BOP refer to foreign
exchange transactions which are made independently of the state of the balance of payment, such as profit motive.
|These items in BOP refer to the transaction which is undertaken to cover deficit or surplus in autonomous transactions.|
Is there an error in this question or solution?
Video Tutorials For All Subjects
- Concept of Balance of Payments Account
Solution Distinguish Between an Autonomous Transaction and Accommodating Transactions of the Balance of Payments Account. Concept: Concept of Balance of Payments Account.