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    Question

    In order to get to the Net Invisibles, we need to fetch the difference between the value of exports and value of imports of invisibles of a country in a given period of time. Which of the following make a part of Invisibles?

    (1) services

    (2) transfers

    (3) flows of income

    Which of the above statement(s) is/are CORRECT?

    A 1 & 2 only Correct Answer Incorrect Answer
    B 2 only Correct Answer Incorrect Answer
    C 1 & 3 Only Correct Answer Incorrect Answer
    D 1, 2, & 3 Correct Answer Incorrect Answer
    E 3 Only Correct Answer Incorrect Answer

    Solution

    Net Invisibles is the difference between the value of exports and value of imports of invisibles of a country in a given period of time. Invisibles include services, transfers and flows of income that take place between different countries. Services trade includes both factor and non-factor income. Factor income includes net international earnings on factors of production (like labour, land and capital). Non-factor income is net sale of service products like shipping, banking, tourism, software services, etc.

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