​If the Fed Desires to Weaken the Dollar Without Affecting

question 22

Multiple Choice

​If the Fed desires to weaken the dollar without affecting the dollar money supply, it should:

• A) ​exchange dollars for foreign currencies, and sell some of its existing Treasury security holdings for dollars.
• B) ​exchange foreign currencies for dollars, and sell some of its existing Treasury security holdings for dollars.
• C) ​exchange dollars for foreign currencies, and buy existing Treasury securities with dollars.
• D) ​exchange foreign currencies for dollars, and buy existing Treasury securities with dollars.

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Definitions:

Marginal Product

Marginal product is the additional output resulting from the use of one more unit of a variable input, holding other inputs constant.

Fertilizer

Substances used to supply essential nutrients to plants, aiming to enhance growth, yields, and quality of agricultural produce.

Bushels

A unit of volume that is used in dry measure, equal to 32 quarts or approximately 35.2 liters.

Price

The price required to be paid for a product or service.