Economics 0455 · IGCSE · Monetary policy

Monetary policy — practice question

An African government has given up its own dollar and now uses the US dollar as its currency. Why might this policy have been needed?

  • ACommercial banks restricted their lending.
  • BConsumers only used credit cards rather than paper money.
  • CIts own dollar no longer acted as a store of value.
  • DThe central bank controlled the issue of money too tightly.

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