If the Fed Wants to Depreciate the Dollar Against the Yen

question 57

Multiple Choice

If the Fed wants to depreciate the dollar against the yen, the Fed will

• A) increase the demand for dollars by selling yen.
• B) decrease the supply of dollars by selling yen.
• C) increase the supply of dollars by selling yen.
• D) increase the supply of dollars by buying yen.

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Definitions:

Largest

Being the greatest in size, quantity, or degree compared to others in a set or group.

United States

A federal republic consisting of 50 states, a federal district, five major self-governing territories, and various possessions.

Comparative Advantage

The capacity of an entity, whether a single person, a corporation, or a nation, to create a product or offer a service more cost-effectively in terms of foregone opportunities than its competitors.

Low Opportunity Cost

A situation where the cost of foregoing the next best alternative is relatively minimal when choosing one option over another.