If the Fed Sells $1 Billion of Short-Term Securities Issued

question 67

Multiple Choice

If the Fed sells $1 billion of short-term securities issued by the Bank of Japan and at the same time purchases $1 billion of short-term securities issued by the U.S. Treasury,

• A)the monetary base will decline by $1 billion.
• B)the monetary base will rise by $1 billion.
• C)the Fed has conducted an unsterilized foreign-exchange intervention.
• D)the Fed has conducted a sterilized foreign-exchange intervention.

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Definitions:

Conditioned Fear

A learned response to a previously neutral stimulus that has been repeatedly paired with an aversive stimulus, resulting in the expression of fear responses to the neutral stimulus alone.

Safe Biking Trail

A designated path for bicycle riding that is designed or modified to minimize risk and enhance safety for cyclists.

Classical Conditioning

A learning process that occurs when two stimuli are repeatedly presented together, eventually eliciting the same response.

Operant Behavior

Behavior that is controlled by consequences, including reinforcement or punishment, which alter the likelihood of the behavior being repeated.