The Current Account Shows Transactions in Goods and Services; the Capital

question 167

True/False

The current account shows transactions in goods and services; the capital account shows purchases and sales of assets; and the official reserve transactions account shows movement of international reserves.

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Definitions:

Cash Operating Expenses

Expenditures that a company makes in cash for the day-to-day running of its business.

Capital Budgeting

The process of planning and managing a company's long-term investments in assets and projects based on their potential to generate earnings and cash flow.

Incremental Sales

This refers to the additional revenue generated from a new business strategy or marketing effort beyond existing sales.

Operating Expenses

Recurring expenses related to the normal business operations, such as wages, rent, and utilities, but not including cost of goods sold.