Which of the following statements is incorrect?
A) A foreign exchange intervention affects the value of a country's currency by changing domestic interest rates
B) Any central bank policy that influences the domestic interest rate will affect the exchange rate
C) Higher U.S.interest rates would likely result in an appreciation of the U.S.dollar
D) Changes in foreign exchange reserves always affect a country's monetary base
Correct Answer:
Verified
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Q39: A country that frequently uses capital controls:
A)Increases
Q40: Adding international reserves for a central bank:
A)Increases
Q42: If interest rates in the U.S.increases relative
Q43: A foreign exchange intervention that does not
Q44: Fixing an exchange rate between two countries
Q45: A sterilized foreign exchange intervention would:
A)Alter the
Q46: All of the following are costs of
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