If the Fed sterilizes the purchase of foreign assets,
A) the monetary base is left unchanged.
B) the monetary base rises by the amount of the purchase.
C) the monetary base falls by the amount of the purchase.
D) the monetary base may rise, fall, or remain unchanged depending on the reaction of domestic interest rates to the purchase.
A
Economics
You might also like to view...
By paying a higher-than-market wage, a firm can avoid the problem of
a. reputation as hostage b. moral hazard c. the winner's curse d. adverse selection e. symmetrical information
Economics
Using Figure 1 above, if the aggregate demand curve shifts from AD1 to AD2 the result in the long run would be:
A. P1 and Y2. B. P2 and Y2. C. P3 and Y1. D. P2 and Y3.
Economics