If the Fed Sterilizes the Purchase of Foreign Assets

question 25

Multiple Choice

If the Fed sterilizes the purchase of foreign assets,

• A)the monetary base is left unchanged.
• B)the monetary base rises by the amount of the purchase.
• C)the monetary base falls by the amount of the purchase.
• D)the monetary base may rise, fall, or remain unchanged depending on the reaction of domestic interest rates to the purchase.

---

Definitions:

Partnership Evidence

This term is unclear in this context and may not specifically refer to a well-defined legal or business concept. NO.

Profits and Losses

Financial terms representing the positive and negative financial results of a business's operations, respectively.

Firm Manager

A firm manager is an individual responsible for overseeing the administrative operations, managing staff, and ensuring the efficient running of a firm or business.

Asset Securitization

The financial process of transforming illiquid assets into securities by pooling various financial assets and then selling them to investors.