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Questions and Answers
In the context of currency substitution, what does dollarization refer to?
In the context of currency substitution, what does dollarization refer to?
- The gradual conversion to full currency substitution
- The use of any foreign currency instead of a domestic currency
- The use of the euro as a foreign currency
- The use of the United States dollar as a foreign currency (correct)
Which country uses the Swiss franc due to the impracticality of maintaining an independent currency?
Which country uses the Swiss franc due to the impracticality of maintaining an independent currency?
- Ecuador
- Liechtenstein (correct)
- Zimbabwe
- El Salvador
When does full currency substitution typically occur?
When does full currency substitution typically occur?
- When a country's currency is strong
- After a major economic crisis (correct)
- When a country is experiencing rapid economic growth
- During a period of economic stability
What is partial currency substitution?
What is partial currency substitution?
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What was the process of converting to the U.S. dollar during the 1990s an example of?
What was the process of converting to the U.S. dollar during the 1990s an example of?
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