Question

Decide if it is capital account or current account: Thanks!

1.When a U.S. sales subsidiary of a foreign car manufacturer receives a shipment of cars, the item appears on,

2.When a German tourist buys a ticket to a Broadway show the item appears on,

3.A coupon payment on a corporate bond paid to a foreign citizen that owns it appears on

4.When a cargo ship owner buys insurance against piracy from a U.S. property casualty insurance company the item appears on,

5.When a bank certificate of deposit of a U.S. bank is purchased by U.K. resident this item appears on,

6.When a U.S. bank pays the interest on a certificate of deposit purchased by a U.K. resident this item appears on

7.When a check is sent by a Ecuadorian worker from Spain (where he is a farm laborer) to his family in Quito this item appears on

8.When a U.S. citizen purchases a share of Nestlé's stock on the London stock exchange this item appears on

9.When the U.S. army purchases gas from an Iraqi supplier to power vehicles in Kurdistan this item appears on

10.When Japanese investors purchase Rockefeller Center in New York this item appears on

Answer 1

1. Current Account because export and imports of goods represent current account.
2. Current Account because service was bought
3. Capital account because investment in assets and liabilities comes under capital account
4.Current Account
5. Capital Account
6. Capital Account
7. Current Account
8. Capital Account
9. Current Account
10. Capital Account

Please Discuss in case of Doubt

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