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A sterilized foreign exchange intervention always a

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4. A sterilized foreign exchange intervention always _________.(a) increases the money supply(b) involves the sale of foreign assets(c) leaves the money supply unchanged(d) involves the sale of domestic assets
5. Under fixed exchange rate regime, what is the effect of fiscal contraction, if the central bankrefrain from intervening in the foreign exchange market?
6. If people expect the domestic currency will be devalued against foreign currency in the nearfuture, they will immediately shift from ________ currency to _______ currency, causing animmediate __________ of the foreign currency.
7. The reduction in the value of a currency due to market forces is known as _______.
8. When the Reserve Bank of Australia (RBA) purchases a government bond in the openmarket ________.(a) reserves in the banking system increases(b) RBA liabilities remain unchanged(c) RBA liabilities decline(d) reserves in the banking system decline

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Term
Fall
Professor
NoProfessor
Tags
Monetary Policy, Foreign exchange market, United States dollar

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