Question

Assertion (A) : Capital flight is the major problem of free floating exchange rate system.
Reason (R) : Capital flight occurs due to change in the interest rates.

• A. Both A and R are true and R is the correct explanation of A
• B. Both A and R are true and R is not the correct explanation of A
• C. A is true, but R is false
• D. A is false, but R is true

Answer 1

The Correct Option is B

The correct option is (B): Both A and R are true and R is not the correct explanation of A