Question

Foreign exchange transactions which are independent of other transactions in the Balance of Payments Account are called ______.

Options

• Current transactions

• Capital transactions

• Autonomous transactions

• Accommodating transactions

Answer 1

Foreign exchange transactions which are independent of other transactions in the Balance of Payments Account are called autonomous transactions.

Explanation:-

An autonomous item in balance of payment refers to foreign exchange transactions which are made independently of the state of the balance of payment, such as profit motive.