Surplus in Balance of Payments (BOP) refers to the excess of ______ . (Choose the correct alternative to fill in the blank)
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Remember: A surplus in the balance of payments (BOP) occurs when total receipts exceed total payments, whereas a deficit occurs when total payments exceed total receipts.
Capital Account receipts over Capital Account payments
Autonomous receipts over Autonomous payments
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The Correct Option isD
Solution and Explanation
A surplus in the Balance of Payments (BOP) occurs when the inflow of autonomous receipts (e.g., exports, foreign investments) exceeds the outflow of autonomous payments (e.g., imports, foreign aid). It indicates a positive balance in the country's international transactions.