The figure below shows the demand (D) and supply (S) curves of cocoa in the U.S.Figure 21.4

-A reserve currency is a currency that is:
A)used exclusively to settle domestic debts.
B)specifically designed for use by commercial banks to settle accounts.
C)held only by bureaucrats.
D)used to settle international debts by private corporations.
E)held by governments to facilitate foreign exchange market interventions.

Question

The figure below shows the demand (D) and supply (S) curves of cocoa in the U.S.Figure 21.4
 
-A reserve currency is a currency that is:
A)used exclusively to settle domestic debts. 
B)specifically designed for use by commercial banks to settle accounts. 
C)held only by bureaucrats. 
D)used to settle international debts by private corporations. 
E)held by governments to facilitate foreign exchange market interventions.

Quizplus · Accepted Answer

A reserve currency is held by governments and central banks to facilitate international trade and financial transactions, including foreign exchange market interventions.

The Figure Below Shows the Demand (D) and Supply (S)