Assume That the Dollar Has Been Consistently Appreciating Over a Long

question 55

Multiple Choice

Assume that the dollar has been consistently appreciating over a long period. The Fed decides to counteract this movement by intervening in the foreign exchange market using nonsterilized intervention. The Fed would

• A)buy dollars with foreign currency and simultaneously sell Treasury securities for dollars.
• B)buy dollars with foreign currency and simultaneously buy Treasury securities with dollars.
• C)sell dollars for foreign currency and simultaneously sell Treasury securities for dollars.
• D)sell dollars for foreign currency and simultaneously buy Treasury securities with dollars.
• E)none of the above

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Definitions:

Preponderance Of The Evidence

A standard of proof in civil cases, requiring that a party's argument is more likely to be true than not based on presented evidence.

Manner Of Performance

Refers to the way in which an obligation, task, or duty is to be executed or fulfilled according to the terms of an agreement or contract.

IOU

An informal document that acknowledges a debt owed.

Promise To Pay

A written agreement in which one party pledges to pay a specified sum to another party under defined conditions.