The balance of payments of a country is a systematic record of:

Answer: (a) all import and export transactions of a country during a given period of time, normally a year

The balance of payments (BoP) records a country's transactions with the rest of the world over a set period, usually a year. Option (a) is the only choice that covers both imports and exports over such a period. The other options each cover only a part of it.

• ✓ (a) The BoP is a record of a country's external transactions over a specified period, typically a year. It covers purchases and sales of goods and services, which are the import and export transactions. It also covers assets, which option (a) does not mention, but of the four options this is the closest description.
• ✗ (b) Goods exported are only one entry on the credit side of the current account. The BoP also records imports, services, income, transfers and capital flows.
• ✗ (c) The BoP covers transactions between a country's residents (households, firms and government) and the rest of the world. It is not limited to government-to-government dealings.
• ✗ (d) Capital movements make up only the capital account of the BoP. The other main part is the current account, which covers goods, services, income and transfers.

Remember · BoP = record of transactions in goods, services and assets between residents and the rest of the world over a period, typically a year. It has a current account and a capital account.

📘 Read it in NCERT: Class 12 Introductory Macroeconomics, Ch 6 (practise this chapter)

Question: UPSC Civil Services (Preliminary) 2013, General Studies Paper I. Explanation: Minimalist IAS, checked 25 Oct 2026 (how we verify). · Report an error