Question 1:

Which of the following transactions are current account transactions and which are capital account transactions in the domestic balance of payments: a) a sale of lumber to Japan; b) a purchase of domestic treasury bills from a foreign resident; c) rental of a hotel room to a tourist from abroad; d) a purchase of a super-computer from a foreign country.

Choose the correct option below.

1. all are current account transactions.

2. a) and c) are current account transactions and b) and d) are capital account transactions.

3. a), c) and d) are current account transactions and b) is a capital account transaction.

4. a), c), and d) are current account transactions and b) is not a balance of payments transaction.