Multiple Choice Questions on Which of the following statements in context of full capital a c convertibility is incorrect ........ for UPSC Civil Services Examination (General Studies) Preparation

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Multiple Choice Questions

Which of the following statements in context of full capital a c convertibility is incorrect ........

Economic Affairs Balance of Payments
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    Which of the following statements in context of full capital a/c convertibility is incorrect?

    It gives freedom to convert local financial assets into foreign ones at market-determined exchange rates

    Incorrect Answer

    It is normally undertaken by countries which are financially unstable under international pressure.

    Correct Answer

    It is beneficial for a country because inflow of foreign investment increases

    Incorrect Answer

    It could destabilize an economy due to massive capital flows in and out of the country

    Incorrect Answer
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    Explanation:

    2nd option is incorrect i.e. Capital Account Convertibility is normally undertaken by countries which are financially unstable under international pressure.

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