Under fixed exchange rates, domestic asset transactions by the central bank
A) can be used to alter the level of foreign reserves but not to affect the state of employment and output.
B) cannot be used to alter the level of foreign reserves but only to affect the state of employment and output.
C) can be used to alter the level of foreign reserves and to affect the state of employment and output.
D) can be used to alter the domestic money supply and the level of foreign reserves.
E) can raise output to full-employment level.
A
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The magnitude of the slope of an indifference curve is the marginal
A) rate of substitution. B) rate of relative prices. C) utility of substitution. D) rate of utility of income.
Refer to Figure 3-4. If the price is $10
A) there would be a surplus of 600 units. B) there would be a surplus of 200 units. C) there would be a shortage of 200 units. D) there would be a shortage of 600 units.