Which of the Following Is True

question 5

Multiple Choice

Which of the following is true?

• A)When the Fed participates in an intervention, it does so by purchasing or selling dollars for other foreign currencies.
• B)Reserves are augmented when the Fed sells foreign currencies in exchange for dollars.
• C)Reserves are decreased when the Fed sells dollars in exchange for foreign currencies that it has previously accumulated.
• D)Sterilization will insure that a foreign exchange operation affects the monetary base.

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Definitions:

Chief Administrator

The highest-ranking official in charge of managing and supervising the operations of a particular organization or governmental body.

Executive Branch

The branch of government responsible for executing and enforcing laws, typically headed by the president or prime minister.

Administrative Process

A series of procedures and operations carried out by a government or an organization to execute policies, decisions, or laws.

Zone of Interests

A legal concept that determines whether a party has sufficient stake in a controversy or issue to bring a lawsuit based on statutory or constitutional standing requirements.