Suppose the Bank of England Is Using a Managed Floating

question 38

Multiple Choice

Suppose the Bank of England is using a managed floating exchange regime.In order to keep money supply constant the Bank of England exchanges domestic bonds for foreign bonds to slow any appreciation of the pound while keeping the British money supply unchanged.This process is known as:

• A) Sterilized intervention
• B) The monetary approach
• C) Exchange rate intervention
• D) Balancing official settlements.

---

Definitions:

Net Income

The total profit of a company after all expenses, including taxes and interest, have been deducted from total revenue.

Distributions

Payments made from a company or a fund to its shareholders, often from profits or reserves.

Risk

The exposure to the chance of loss or adverse outcomes in decision-making and financial investments, varying in likelihood and potential impact.

Uncertainty

The lack of certainty or predictability in the outcome of an event, often affecting decision-making and financial projections.