Restrictions on external convertibility can limit domestic companies from investing abroad.

Question

Quizplus · Accepted Answer

Restrictions on external convertibility, such as limits on the ability to freely exchange domestic currency for foreign currency, can make it more difficult for domestic companies to invest abroad. Without the ability to easily exchange currencies, it may be harder to navigate foreign exchange risks and finance foreign investments.

Restrictions on External Convertibility Can Limit Domestic Companies from Investing