The Fed wants to counter downward pressure on the dollar, so it will most likely ________.
A)sell dollars for foreign currency
B)sell dollars and buy foreign stocks
C)buy Treasury bills with dollars
D)buy dollars with foreign currency

Question

Quizplus · Accepted Answer

Buying dollars with foreign currency would increase the demand for dollars, which would counter downward pressure on the dollar. Selling dollars or buying foreign stocks would both decrease the demand for dollars, and buying Treasury bills does not directly address the issue of downward pressure on the dollar.

The Fed Wants to Counter Downward Pressure on the Dollar