Why do governments limit convertibility of their currency?
A) to encourage foreign investments
B) to control currency appreciation
C) to encourage capital flight
D) to preserve their foreign exchange reserves
E) to promote neo-mercantilism

Question

Quizplus · Accepted Answer

Governments limit currency convertibility to preserve their foreign exchange reserves, ensuring they have enough reserves to manage economic stability and meet international obligations.

Why Do Governments Limit Convertibility of Their Currency