Option 1 -> Incorrect. Current account includes more than just visible items (goods).
Option 2 -> Incorrect. External borrowings are part of capital/financial account, not current account.
Option 3 -> Correct. Current account comprises trade in goods and services plus transfer payments.
Option 4 -> Incorrect. Short term debt belongs to capital/financial account.
Hence, Option 3: Exports and imports of goods & services plus transfer payments -> The current account is a component of the balance of payments that records a country's transactions with the rest of the world. It includes: (1) Trade in goods/merchandise - visible items, (2) Trade in services - invisible items like tourism, banking, insurance, (3) Primary income - investment income, compensation, and (4) Secondary income - transfer payments like remittances, grants, and foreign aid. External borrowings and debt are recorded in the capital and financial account, not the current account. -> correct