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    Question

    Which among the following help reduce our Current Account Deficit (CAD)?

    A High remittance from abroad Correct Answer Incorrect Answer
    B Encouraging export Correct Answer Incorrect Answer
    C Reducing import Correct Answer Incorrect Answer
    D Reducing interest payment on loans taken Correct Answer Incorrect Answer
    E All of the above Correct Answer Incorrect Answer

    Solution

    Increase in remittance will enhance the inflow of foreign currency and will reduce the CAD. Trade deficit is one of the major reason behind our Current Account Deficit. So this trade deficit can be reduced by increasing export and reducing import. Interest payment on loans is also a part of Current Account. Thus reducing the payment interest will reduce our CAD

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