Question

describe current account transaction encompass

Answer 1

In International Trade and Finance,current account transaction is related to financial transactions involving international trade,funds remittance from abroad,expenses pertaining to foreign travel,education,medical and other expenses of parents or relatives staying abroad.

Explanation:

Main inclusions of the current account transaction:-

• Any financial or monetary transactions related to international trade,business transactions such as short term and long term banking transactions and credit or loan facilities.
• Interest payments on loans and other investment related payments and earnings related to business operation.
• Fund remittance by any family member,relatives,parents,friends etc from abroad.
• Any financial expenditure on foreign travels and tours,educational and medical sustenance of family members,friends or relatives.
• Usually transactions not included in capital account are included in current account.