With reference to Balance of Payments, which of the following constitutes/constitute the Current Account? 1. Balance of trade 2. Foreign assets 3. Balance of invisibles 4. Special Drawing Rights Select the correct answer using the code given below.

1. The Balance of Payments (BoP) records all economic transactions between residents of a country and the rest of the world. It is typically divided into the Current Account and the Capital Account (or Capital and Financial Account). 2. The Current Account deals with transactions in goods, services, income, and current transfers. 3. Statement 1: Balance of trade refers to the difference between the value of exports and imports of goods (visible trade). This is a core component of the Current Account. Correct. 4. Statement 2: Foreign assets represent claims on non-residents. Transactions involving the purchase or sale of foreign assets are recorded in the Capital or Financial Account, not the Current Account. Incorrect. 5. Statement 3: Balance of invisibles refers to the net balance of transactions in services, income (like profits, interest, dividends), and current transfers (like remittances, grants). This is the other major part of the Current Account. Correct. 6. Statement 4: Special Drawing Rights (SDRs) are international reserve assets created by the IMF. Transactions involving SDRs are typically recorded in the Financial Account as changes in reserve assets, not in the Current Account. Incorrect. Therefore, the Balance of trade (1) and the Balance of invisibles (3) constitute the Current Account.