Balance of Payments 1

Balance of Payments 1

Point out a demerit of flexible exchange rate

Creates instability BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

Point out a demerit of fixed exchange rate

Contradicts the objectives of free markets BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

Point out a merit of flexible exchange rate

Eliminates overvaluation or undervaluation of currencies BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

Point out a merit of fixed exchange rate

Ensures stability of the fixed exchange BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

Current account records all payments to rest of the world as ______ and all receipts from rest of the world as _____

Debit, credit BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

Consider the following statements regarding the floating exchange rates: Which of the statements given above is/are corr

Both 1 and 2 BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

Balance of trade is a _______ concept as compared to balance of payments.

narrower BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

Assertion (A): Manage floating exchange rate system is a hybrid system of exchange rate used by the most of the countrie

Assertion (A) is true and Resason BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

Assertion (A): Demand for foreign exchange and exchange rate moves in the same direction. Reason (R): When exchange rate

Assertion (A) is false, but Reason BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

Clean floating exchange rate is determined at a point wher

Demand for foreign exchange and Supply BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

he US $ exchange rate for rupee is ₹ 75 now, as compared to ₹ 63 previously. This shows that the value of rupee has

depreciated BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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Balance of Payments 1

Relationship between demand for foreign exchange and foreign exchange rate is

Inverse BOP correct; tariff barrier makes imports costlier restricts trade.

Ref: NCERT Economics Class XII Chapter 6 Balance of Payments explains BOP current capital account tariff quota exchange rate IMF concepts.

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