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If a Central Bank Does Not Want to Allow the Domestic

question 50

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If a central bank does not want to allow the domestic currency to depreciate,it will ________ international reserves by purchasing its currency,thereby ________ the monetary base and increasing the risk of higher unemployment.


Definitions:

Impedance

The total resistance to the flow of alternating current (AC) in a circuit, comprising both resistive and reactive components, measured in ohms.

Inductive Reactance

The opposition that an inductor presents to alternating current, due to the inductor's inductance, measured in ohms.

Power (P)

The rate at which electrical energy is transferred by an electric circuit, usually measured in watts (W).

Parallel Circuit

An electrical circuit in which components are connected across common points or junctions, allowing multiple paths for the current.

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