If the Goal Were to Increase the Value of a Country's

question 1

Multiple Choice

If the goal were to increase the value of a country's currency - to fight an depreciation of the domestic currency in exchange for foreign currency - the central bank would:

• A) buy its own currency in exchange for foreign currency.
• B) follow a expansive monetary policy.
• C) drive real rates of interest down.
• D) sell its own currency in exchange for foreign currency.

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