Official intervention in the foreign exchange market to defend a fixed-exchange rate when the value of the country's currency is under downward pressure causes
A. no change in the liabilities of the central bank.
B. international reserve holdings to fall.
C. the domestic money supply to rise.
D. a downward pressure on the country's interest rates.
Answer: B
You might also like to view...
Which of the following is the best example of a "free" good?
A) HIV/AIDS cocktails freely distributed to people in developing countries B) The air you are currently breathing C) Public roads D) Public schooling in states where education is subsidized
Mechanisms that manufacturers can use to deal with misaligned retailer incentives include
a. setting a minimum retail price b. allowing many retailers to sell the product in each market c. preventing retailers from compensating sales staff for demonstrating the product d. eliminate manufacturer staff that was demonstrating the product in stores
An increase in the marginal propensity to consume necessarily reduces the marginal propensity to save
a. True b. False Indicate whether the statement is true or false
Based on the rule of 72, it would require 18 years for an economy to double its real output if the annual growth rate was 4%
a. True b. False Indicate whether the statement is true or false