A Currency Is Said to Be Freely Convertible When

question 24

Multiple Choice

A currency is said to be freely convertible when

• A) its exchange rate with respect to other currencies is decided by the central bank of the country.
• B) residents alone are allowed to convert it into a foreign currency without any limitations.
• C) neither residents nor nonresidents are allowed to convert it into a foreign currency.
• D) both residents and nonresidents are allowed to purchase unlimited amounts of a foreign currency with it.

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