Q. When the balance of payments of a country is in equilibrium?
Answer: demand for the domestic currency is equal to its supply
Notes: When the balance of payments (BOP) of a country is in equilibrium, the surplus or deficit is eliminated from the BOP. When the BOP of a country is in equilibrium, the demand for domestic currency is equal to its supply. The demand and supply situation is thus neither favourable nor unfavourable.

This question is part of 40000+ General Studies MCQ Series Course on GKToday Android app. Question Number: 61 in 43. Foreign Trade - Policy, Balance of Trade, Balance of Payment, WTO in above course in App.