Everything Else Held Constant,if a Central Bank Makes an Unsterilized

question 85

Multiple Choice

Everything else held constant,if a central bank makes an unsterilized ________ of foreign assets,then the domestic money supply will decrease and the domestic currency will ________.

• A)purchase;appreciate
• B)purchase;depreciate
• C)sale;appreciate
• D)sale;depreciate

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Definitions:

Direct Foreign Investment

Occurs when a firm headquartered in one country builds or purchases operating facilities or subsidiaries in a foreign country.

Physical Assets

Tangible and material assets such as buildings, machinery, and equipment owned by a business.

International Environment

The global context within which organizations operate, including economic, social, cultural, and political factors.

Future Orientation

The degree to which individuals or organizations plan for and consider future outcomes in their decision-making processes.