Assertion (A): Capital Account convertibility is introduced only sometimes, after the introduction of convertibility on the current account, when the exchange rate of the currency of a country is relatively stable.
Reason (R): Capital Account convertibility is necessary for faster growth and development of the economy, and it makes foreign exchange rate more stable.

A) (A) is correct, but (R) is incorrect B) (A) and (R) both are correct, and (R) is the right explanation of (A) C) (A) and (R) both are correct, but (R) is not the right explanation of (A) D) Both (A) and (R) are incorrect

Answer & Solution

Correct Answer: Option A

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List-I	List-II
a. Modigliani Miller approach	1. Commercial papers
b. Net operating income approach	2. Working capital management
c. Short-term money market instrument	3. Capital structure
d. Factoring	4. Arbitrage

Assertion (A) Capital Account convertibility is introduced only sometimes after the...

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