Question

Cash accounting measures the deficit as the difference between __________; capital accounting measures it as the difference between ___________.

Answer 1

Solution-

Cash accounting measures the deficit as the difference between Revenue and expenditure; capital accounting measures it as the difference between Non resident investment and resident investment. Reason- Cash accounting," generally measuring the deficit as the difference between cash taken in and cash paid out (some spending such as student loans, however, is not measured on a cash basis.The current account deficit as the measure of Net foreign direct investment and Net foreign direct investment is equal to Non resident investment minus Resident investment. NOTE : PLEASE GIVE OPTIONS IN COMMENT,I WILL GIVE YOU CORRECT OPTION OR ANSWER IF YOU SATISFY PLEASE UP VOTE, HAVE A NICE DAY THANK YOU.