If a Central Bank Does Not Want to See Its

question 20

Multiple Choice

If a central bank does not want to see its currency rise in value,it may pursue ________ monetary policy to ________ the domestic interest rate,thereby weakening its currency.

• A)expansionary;raise
• B)contractionary;raise
• C)expansionary;lower
• D)contractionary;lower

---

Definitions:

Residuals

Differences between observed values and the values predicted by a model, showing the extent of deviation from a fit line.

Test Statistic F

The ratio of two variances that follows an F-distribution, used in statistical methods like ANOVA to determine the significance of group differences.

Degrees of Freedom

The number of independent values or quantities that can be assigned to a statistical distribution without violating any constraints.

Dependent Variable

A variable in an experiment or model that is expected to change as a result of manipulations or changes in the independent variable(s).