All Courses
Explore Courses UPSC Exam UPSC Test Series Free Notes EduRev Infinity Get the App Login Join for Free
Sign in Open App
Class 12 Exam  >  Class 12 Questions  >  Assertion (A): Purchase of Machinery from res... Start Learning for Free
SaveJoin the Discussion on the App
Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.

Reason (R): Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.

Alternatives

  • a)
    Assertion (A) is correct, but Reason (R) is incorrect

  • b)
    Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)

  • c)
    Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)

  • d)
    Both Assertion (A) and Reason (R) are incorrect

Correct answer is option 'A'. Can you explain this answer?
FREE This question is part of
Download PDF Attempt Test
Download PDF Attempt this Test
Most Upvoted Answer
Assertion (A): Purchase of Machinery from rest of the world is an econ...
Assertion and Reasoning

Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.

Reason (R): Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.

Explanation

Balance of Payments (BoP) is a systematic record of all economic transactions between the residents of a country and the rest of the world during a given period of time. It consists of two accounts - Current Account and Capital Account.

Current Account captures transactions in goods, services, income and transfers, while Capital Account records transactions involving capital transfers and acquisition or disposal of non-financial assets.

In the given assertion, the purchase of machinery from the rest of the world is a transaction involving the acquisition of a non-financial asset. Hence, it falls under the Capital Account of BoP.

The reason given in the question is incorrect. Any transaction that affects the assets or liabilities of a country is recorded in the Capital Account of BoP, not the Current Account. The Current Account only records transactions related to the exchange of goods, services, income and transfers.

Conclusion

Hence, the correct answer is option (A) Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A).
Free Test
FREE
Start Free Test
Start Free Test
Community Answer
Assertion (A): Purchase of Machinery from rest of the world is an econ...
Purchase of machinery will be recorded in current account of BoP as it is considered as an import of goods. Whereas transaction that has an impact on the assets or liabilities of the country is recorded in capital account of BoP.
< Previous Question Next Question >
Explore Courses for Class 12 exam

Similar Class 12 Doubts

Read the passage given below and answer the following questions:The d block elements are the 40 elements contained in the four rows of ten columns (3-12) in the periodic table. As all the d block elements are metallic, the term d-block metals is synonymous. This set of d-block elements is also often identified as the transition metals, but sometimes the group 12 elements (zinc, cadmium, mercury) are excluded from the transition metals as the transition elements are defined as those with partly filled d or f shells in their compounds. Inclusion of the elements zinc, cadmium and mercury is necessary as some properties of the group 12 elements are appropriate logically to include with a discussion of transition metal chemistry. The term transition element or transition metal appeared to derive from early studies of periodicity such as the Mendeleev periodic table of the elements. His horizontal table of the elements was an attempt to group the elements together so that the chemistry of elements might be explained and predicted. In this table there are eight groups labeled I-VIII with each subdivided into A and B subgroups. Mendeleev recognized that certain properties of elements in Group VIII are related to those of some of the elements in Group VII and those at the start of the next row Group I. In that sense, these elements might be described as possessing properties transitional from one row of the table to the next.In the following questions, a statement of assertion followed by a statement of reason is given. Choose the correct answer out of the following choices on the basis of the above passage.Assertion (

Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.Reason (R):Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.Alternativesa)Assertion (A) is correct, but Reason (R) is incorrectb)Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)c)Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)d)Both Assertion (A) and Reason (R) are incorrectCorrect answer is option 'A'. Can you explain this answer?
Question Description
Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.Reason (R):Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.Alternativesa)Assertion (A) is correct, but Reason (R) is incorrectb)Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)c)Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)d)Both Assertion (A) and Reason (R) are incorrectCorrect answer is option 'A'. Can you explain this answer? for Class 12 2024 is part of Class 12 preparation. The Question and answers have been prepared according to the Class 12 exam syllabus. Information about Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.Reason (R):Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.Alternativesa)Assertion (A) is correct, but Reason (R) is incorrectb)Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)c)Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)d)Both Assertion (A) and Reason (R) are incorrectCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for Class 12 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.Reason (R):Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.Alternativesa)Assertion (A) is correct, but Reason (R) is incorrectb)Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)c)Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)d)Both Assertion (A) and Reason (R) are incorrectCorrect answer is option 'A'. Can you explain this answer?.
Solutions for Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.Reason (R):Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.Alternativesa)Assertion (A) is correct, but Reason (R) is incorrectb)Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)c)Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)d)Both Assertion (A) and Reason (R) are incorrectCorrect answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for Class 12. Download more important topics, notes, lectures and mock test series for Class 12 Exam by signing up for free.
Here you can find the meaning of Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.Reason (R):Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.Alternativesa)Assertion (A) is correct, but Reason (R) is incorrectb)Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)c)Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)d)Both Assertion (A) and Reason (R) are incorrectCorrect answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.Reason (R):Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.Alternativesa)Assertion (A) is correct, but Reason (R) is incorrectb)Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)c)Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)d)Both Assertion (A) and Reason (R) are incorrectCorrect answer is option 'A'. Can you explain this answer?, a detailed solution for Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.Reason (R):Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.Alternativesa)Assertion (A) is correct, but Reason (R) is incorrectb)Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)c)Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)d)Both Assertion (A) and Reason (R) are incorrectCorrect answer is option 'A'. Can you explain this answer? has been provided alongside types of Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.Reason (R):Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.Alternativesa)Assertion (A) is correct, but Reason (R) is incorrectb)Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)c)Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)d)Both Assertion (A) and Reason (R) are incorrectCorrect answer is option 'A'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice Assertion (A): Purchase of Machinery from rest of the world is an economic transaction of capital account of BoP.Reason (R):Any transaction that impacts the assets or liabilities of a country are recorded on current account of BoP.Alternativesa)Assertion (A) is correct, but Reason (R) is incorrectb)Both Assertion (A) and Reason (R) are correct, but Reason (R) is not the correct explanation of Assertion (A)c)Both Assertion (A) and Reason (R) are correct and Reason (R) is the correct explanation of Assertion (A)d)Both Assertion (A) and Reason (R) are incorrectCorrect answer is option 'A'. Can you explain this answer? tests, examples and also practice Class 12 tests.
Explore Courses for Class 12 exam
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
10M+ students study on EduRev
Get App
© EduRev
Education Revolution
Follow Us
Signup to see your scores go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup