Consider the following statements regarding the Capital Inflows: 

  1. Current Account flows are permanent while Capital Account Flows are reversible 
  2. Current Account flows arise out of transactions in services while Capital account inflows arise out of transactions in goods. 
  3. The Government needs to keep a close eye on the Capital Account flows because they may get reversed. 

Which among the above statements is/ are correct?

[A] Only 1 & 3
[B] Only 2 & 3
[C] Only 1
[D] All 1, 2 & 3

Show Answer

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