Official Answer Key & Detailed Solution
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Correct Answer: Option (B) — 1, 2 and 4
Concept & Option Breakdown
Standard Reference VerifiedCapital Account records transactions altering the international asset and liability position of a country, including Foreign Loans (1), Foreign Direct Investment (2), and Portfolio Investment (4). Private Remittances (3) are unilateral transfer payments and form part of the Invisibles under the Current Account.
Remittances are current unilateral transfers, not investments that create future claims/liabilities. Eliminating 3 leaves only option (b).
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