Question
When the payment of a country exceeds the receipt from
trade of goods and services, transfers and net income, it is called:Solution
Current Account Deficit (CAD) refers to the deficit on the current account side of the Balance of Payment. In other words, when payment from trade (both goods and services), income and transfer exceeds receipts, it will be called Current Account Deficit. When the net Current Account Balance is positive, it is called Current Account Surplus. India generally have a deficit in its current account.
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