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WAEC Economics 2024 Question 47

Question 47

Balance of Payments and Exchange Rates

Short-term deficits in the current account of the balance of payments can be financed by balancing with the

  1. A.invisible account.
  2. B.capital account.
  3. C.visible account.
  4. D.national income account.
Show the answer and explanation

Answer: B (capital account.)

Explanation

A current account deficit is financed by capital inflows (borrowing, investment) recorded in the capital account.