Central Bank sometimes carry out equal foreign and domestic asset transactions in opposite directions to nullify the impact of their foreign exchange operations on the domestic money supply. This policy is called sterilized foreign exchange intervention.
举一反三
- When<br/>the central bank allows the purchase or sale of domestic currency to<br/>have an effect on the monetary base, it is called A: an<br/>unsterilized foreign exchange intervention. B: a<br/>sterilized foreign exchange intervention. C: an<br/>exchange rate feedback rule. D: a<br/>money neutral foreign exchange intervention
- Following an expansion of the money supply, a government committed to<br/>maintaining a fixed exchange rate must ____. A: accept a surplus in its current account. B: not use sterilized intervention. C: increase its level of government expenditure and autonomous<br/>investments. D: intervene in the foreign exchange market to sell foreign currency and<br/>buy domestic currency.
- The AA schedule shows________. ( ) A: Exchange rate and output pairs at which only the foreign exchange market is in equilibrium. B: Interest rate and output pairs at which only the foreign exchange market is in equilibrium. C: Interest rate and output pairs at which the foreign exchange market and the domestic money market are in equilibrium. D: Exchange rate and output pairs at which the foreign exchange market and the domestic money market are in equilibrium.
- According to the interest rate parity theory, when the forward foreign exchange rate is premium, it means that the domestic interest rate( ) A: is equal to the foreign exchange rate B: lower than foreign exchange rates C: higher than foreign exchange rates D: Not sure
- Under which of the following policies does the government enter the foreign exchange market and buy or sell foreign currency in order to influence the exchange rate of the domestic currency? A: Exchange controls B: Capital controls C: Official intervention D: Adjustable peg