If the Central Banks of the World Chose to Diversify

question 95

Multiple Choice

If the central banks of the world chose to diversify their foreign-exchange reserves away from the dollar and into the euro,

• A)this would have the result of a strengthening of the value of the dollar.
• B)this would have the result of a weakening in the value of the dollar.
• C)this would not have much impact, as the information would be lost in the day-to-day volatility of exchange rates.

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Definitions:

Rail Transportation

The conveyance of passengers and goods by way of wheeled vehicles running on rail tracks, distinguished from other means of transport such as by automobile, bus, or airplane.

Water Transportation

The movement of people or goods via rivers, lakes, seas, and oceans, utilizing different types of vessels for commerce, recreation, or military purposes.

Very High Capacity

Describes systems, facilities, or processes that can handle a significantly large volume of transactions, data, or throughput.

Low Cost

Referring to a strategy or product characterized by offering lower prices compared to competitors, usually by reducing costs in production, materials, or operations.