Which One of the Following Statements Is Most Correct

question 21

Multiple Choice

Which one of the following statements is most correct?

• A) If central banks are not sterilizing and the home country has a balance of payments surplus, any associated increase in a foreign central bank's claims on the home country implies a decreased foreign money supply.
• B) If central banks are not sterilizing and the home country has a balance of payments surplus, any associated decrease in a foreign central bank's claims on the home country implies a decreased foreign money demand.
• C) If central banks are not sterilizing and the home country has a balance of payments surplus, any associated decrease in a foreign central bank's claims on the home country implies a decreased foreign money supply.
• D) If central banks are not sterilizing and the home country has a balance of payments shortage, any associated decrease in a foreign central bank's claims on the home country implies a decreased foreign money supply.
• E) If central banks are not sterilizing and the home country has a balance of payments shortage, any associated decrease in a foreign central bank's claims on the home country implies an increased domestic money supply.

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Definitions:

Random Assignment

A method used in experiments to assign subjects randomly to either the treatment or control group to eliminate bias.

Independent Variable

The factor in an experiment that is deliberately changed or manipulated to observe its effect on a dependent variable.

Equal Chance

A principle whereby each subject or experimental unit in a study has the same probability of being assigned to a particular group or condition.

Archival Research

Research methods involving the use of records or documents of the activities of individuals, groups, or organizations.