In general, a country accumulates reserves when the net of its current and capital account transactions shows a deficit.

Question

Quizplus · Accepted Answer

A country accumulates reserves when the net of its current and capital account transactions shows a surplus, not a deficit. This is because a surplus indicates that a country is exporting more than it is importing or receiving more capital than it is sending abroad, allowing it to accumulate reserves.

In General, a Country Accumulates Reserves When the Net of Its