If the Goal Were to Decrease the Value of a Country's

question 41

Multiple Choice

If the goal were to decrease the value of a country's currency - to fight an appreciation of the domestic currency in exchange for foreign currency - the central bank would:

• A) buy its own currency in exchange for foreign currency.
• B) follow a restrictive monetary policy.
• C) drive real rates of interest up.
• D) sell its own currency in exchange for foreign currency.