Stabilisation measures are short-term policy measures taken to improve the Balance of Payments (BoP) situation in an economy. These measures are implemented to address immediate imbalances in the economy and restore stability.

Stabilisation measures can be implemented by governments and central banks to address various BoP issues such as a large current account deficit, a sharp decline in foreign exchange reserves, or a significant depreciation of the domestic currency. These measures are aimed at stabilising the economy and preventing a crisis.

Here are some key points that explain why stabilisation measures are the correct answer:

1. Definition of stabilisation measures: Stabilisation measures refer to the policies and actions taken by the government and central bank to stabilize the economy. These measures are aimed at addressing short-term imbalances and restoring stability.

2. Focus on short-term policy measures: Stabilisation measures are specifically designed to address immediate BoP issues. They are not intended to bring about long-term structural changes in the economy.

3. Immediate improvement of BoP situation: Stabilisation measures are taken to improve the BoP situation in the short term. These measures can include a combination of fiscal, monetary, and exchange rate policies to restore stability.

4. Examples of stabilisation measures: Some common stabilisation measures include devaluation or depreciation of the domestic currency, fiscal austerity measures, monetary tightening, import controls, and export promotion policies.

5. Temporary nature of stabilisation measures: Stabilisation measures are generally temporary in nature and are implemented until the BoP situation improves. Once stability is restored, policymakers can focus on implementing structural measures to address the underlying causes of the imbalance.

In conclusion, stabilisation measures are short-term policy measures taken to improve the BoP situation in an economy. These measures focus on addressing immediate imbalances and restoring stability. Examples of stabilisation measures include devaluation of the domestic currency, fiscal austerity measures, and import controls.