Final answer:
TransWare Inc.'s inability to convert its Russian plant's profits into U.S. dollars and repatriate them represents a nonconvertible currency situation, which restricts the exchange of the currency on the foreign exchange market. So the correct answer is option E.
Step-by-step explanation:
When TransWare Inc., a company based in Atlanta with a plant in Russia, is profiting but unable to convert these profits into U.S. dollars or take them out of the country, the type of convertibility being described is E) Nonconvertible.
A currency is considered nonconvertible when it cannot be freely exchanged for other currencies on the foreign exchange market. This is often due to foreign exchange regulations put in place by the country issuing the nonconvertible currency. These regulations can prevent the free exchange of their currency with others, which can be challenging for businesses that operate internationally, such as TransWare Inc.
It impacts the company's ability to repatriate profits and affects international transactions similar to a scenario where a foreign firm earns U.S. dollars and is unable to use them to cover expenses back home, or when U.S. tourists are restricted in exchanging their dollars in other countries.