If a Central Bank Wants to Keep the Value of Its

question 97

Multiple Choice

If a central bank wants to keep the value of its home currency fixed in the foreign exchange market, then an increase in the demand for its home currency will lead the central bank to

• A) do nothing.
• B) sell its home currency.
• C) buy its home currency.
• D) sell foreign currencies.

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Definitions:

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A person being accused or sued in a court of law.

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