International reserves are:
A. dollars held by the Federal Reserve to support the value of the dollar.
B. reserves held by banks to back international deposits.
C. foreign currency deposits held by banks to provide international liquidity for domestic customers.
D. foreign currency assets held by a government for the purpose of purchasing domestic currency in the foreign exchange market.
Answer: D
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When the exchange rate appreciates in the short run and then depreciates to its original level in the long run, it implies that the domestic money supply has:
a. temporarily risen. b. permanently risen. c. temporarily fallen. d. permanently fallen.
The key reason that the bursting of the tech-stock bubble of the late 1990s had a mild impact on the macroeconomy is ________
A) rapid intervention by the central bank averted economic catastrophe B) the increase in tech-stock prices was driven by the economic fundamental of technological progress C) the technology sector is a rather small portion of the aggregate economy D) tech-stock prices had not been much influenced by credit availability