The Capital Account is a part of a country's balance of payments that records all transactions related to the ownership of assets. This includes investments made by residents in foreign countries and investments made by foreigners in the domestic economy. It helps to track how much money is flowing in and out of a country through investments, loans, and other financial activities. In simple terms, the Capital Account shows how a country is financing its growth and development. For example, when a company in Country A invests in a factory in Country B, this transaction is recorded in the Capital Account. Understanding this account is crucial for analyzing a nation's economic health and investment climate.