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Answer the following. (Class 12 Economics 2026, Q13)

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EconomicsCBSE Class 12 · Board exam 2026, set 58/5/1 · 4 marks · Short answer

CBSE Class 12 Economics 2026: question 13

Set in the CBSE Class 12 board exam of 2026, paper 58/5/1, section A, question 13, for 4 marks. Try it first; the hints and our step-by-step solution are below.

Q13 · 4 marks · Short answerOpen Economy Macroeconomics

Answer the following.

  1. (a)

    Define Balance of Payments (BoP) Account.

    1 mark
  2. (b)

    Differentiate between autonomous transactions and accommodating transactions in Balance of Payments (BoP).

    3 marks

Source: official question paper from cbse.gov.in (PDF). See it in the full 2026 board paper, set 58/5/1.

Hints

Open one hint at a time and try again before the next.

Hint 1

Which transactions happen anyway, whatever the BoP position?

Hint 2

Accommodating = "balancing" items.

Step-by-step solution

Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.

  1. (a) The Balance of Payments account is a systematic record of all economic transactions in goods, services and assets between the residents of a country and the rest of the world during a period of time, usually a year.

    1 mark

  2. (b) Autonomous transactions are made independently of the state of the BoP, with an economic motive such as profit (e.g. exports, imports, FDI). They are the "above the line" items and decide whether the BoP is in surplus or deficit.

    1½ marks

  3. (b) Accommodating transactions are undertaken by the monetary authorities to cover a surplus or deficit in the autonomous items (e.g. drawing down foreign exchange reserves, borrowing from the IMF). They have no economic motive of their own and are the "below the line" items.

    1½ marks

Answer: (a) The BoP records all transactions of residents with the rest of the world in a year. (b) Autonomous items are made for an economic motive; accommodating items settle the BoP gap.

Where the marks are

  • Definition of BoP (1)
  • Autonomous transactions (1½)
  • Accommodating transactions (1½)

Revise the chapter

Practise this chapterBoard-style questions from Open Economy Macroeconomics, one at a time, marked against the answer key and marking points.Back to the full paper2026 board paper, set 58/5/1: every question, by section.

The question is transcribed from the official paper; figures are described in words. The solution, hints and chapter tag are ours. Spotted an error? Write tosupport@questionbuddy.in.