Refer to Figure 18

question 1

Multiple Choice

Refer to Figure 18.1.Assume that there is a market perception that the value of Thai assets will decrease in the near future.This affects the current equilibrium exchange rate.What can the Thai central bank do to restore the previous value of the baht?

• A)Increase the demand for U.S.dollars
• B)Sell Thai bahts in the foreign exchange market
• C)Sell dollars in the foreign exchange market
• D)Appeal to the WTO for help
• E)Buy back outstanding Thai bonds in open market operations