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Why May a Central Bank Intervene in the Foreign Exchange

question 56

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Why may a central bank intervene in the foreign exchange market when its currency is depreciating?


Definitions:

Sarc

A root word used in medical terms to indicate flesh or connective tissue.

Flesh

The soft substance consisting of muscle and fat between the skin and bones of an animal or a human.

Tumor

A growth of cells that occurs abnormally when cell division exceeds normal limits or when cells fail to die at the appropriate time.

Cancer

A broad group of diseases characterized by the uncontrolled growth and spread of abnormal cells in the body.

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