Forex Reserves of India and Forex Management

21. Which of the following is an example of a capital account transaction?
a. Importing goods from a foreign country
b. Investing in foreign stocks
c. Receiving remittances from abroad
d. Exporting goods to a foreign country

22. What is the primary purpose of imposing capital controls?
a. To encourage capital inflows
b. To restrict capital outflows
c. To stabilize the domestic currency
d. To promote international trade

23. Which of the following statements is true regarding Foreign Direct Investment (FDI)?
a. FDI is a component of the current account of the balance of payments.
b. FDI refers to the purchase and sale of foreign currencies.
c. FDI is a short-term capital flow that can quickly move in and out of a country.
d. FDI involves long-term investments in foreign countries to establish business operations.

24. Which sector attracts the highest FDI inflows in India?
a. Manufacturing sector
b. Information technology sector
c. Financial services sector
d. Tourism and hospitality sector

25. Which organization publishes the “World Investment Report” providing global FDI trends and statistics?
a. International Monetary Fund (IMF)
b. World Bank
c. United Nations Conference on Trade and Development (UNCTAD)
d. World Trade Organization (WTO)