The Main Reason Central Banks Engage in Foreign-Exchange Interventions Is

question 43

Multiple Choice

The main reason central banks engage in foreign-exchange interventions is to

• A)stabilize the domestic money supply.
• B)stabilize domestic interest rates.
• C)stabilize foreign interest rates.
• D)stabilize the exchange rate.

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Definitions:

Effortful Processing

A type of active and conscious information processing requiring attention and effort to encode or remember information.

Automatic Processing

Involves unconscious encoding of incidental information and well-practiced activities, requiring minimal cognitive effort.

Memory Storage

Memory storage refers to the process by which information is encoded, stored, and retrieved in the brain, allowing for the preservation and recall of experiences and knowledge.

Sensory Memory

The shortest-term element of memory, capable of retaining impressions of sensory information after the original stimuli have ended.