Which of the Following Statements About the Central Bank Is

question 9

Multiple Choice

Which of the following statements about the central bank is TRUE?

• A) Only the central bank may hold foreign reserves and intervene officially in exchange markets.
• B) Central banks have little power to affect macroeconomic conditions.
• C) Today, central banks' reserves consist largely of gold.
• D) The Federal Reserve holds only a small level of official reserve assets other than gold.
• E) Central banks never inject money into the economy.

---

Definitions:

Department Stores

Large retail establishments that offer a wide variety of goods in different departments under one roof.

Industrial Output

The total volume of products and services produced by an industry, often used as an indicator of industrial activity and economic health.

Internal Combustion

A process where fuel is burned within an engine, producing power through the expansion of gases.