Although Coordinated Changes in Monetary Policy Are Likely to Affect

question 20

Multiple Choice

Although coordinated changes in monetary policy are likely to affect the exchange rate,

• A)it has proven impossible to achieve such coordination among the world's central banks.
• B)sterilized interventions by themselves are unlikely to have a long-term effect on the exchange rate.
• C)they can do so only at the cost of increasing the worldwide inflation rate.
• D)they can do so only at the cost of significantly increasing the chances of worldwide recession.