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Distinguish Between an Autonomous Transaction and Accommodating Transactions of the Balance of Payments Account. - CBSE (Arts) Class 12 - Economics

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Question

Distinguish between an autonomous transaction and accommodating transactions of the balance of payments account.

Solution

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.
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Solution Distinguish Between an Autonomous Transaction and Accommodating Transactions of the Balance of Payments Account. Concept: Concept of Balance of Payments Account.
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