Multiple choice

Which of the following policies of the financial sectors is basically designed to transfer local financial assets into foreign financial assets freely, and at market determined exchange rates?

  1. Capital Account Convertibility

  2. Financial Deficit Management

  3. Minimum Support Price

  4. Restrictive Trade Practices

  5. None of these
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A Correct answer
Explanation

Capital Account Convertibility refers to the freedom to convert local financial assets into foreign financial assets and vice versa at market-determined exchange rates, which is a key policy for financial integration.

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