A.Any central bank purchase of assets automatically results in an increase in the domestic money supply, while any central bank sale of assets automatically causes the money supply...

A.If central banks are not sterilizing and the home country has a balance of payments surplus, any associated increase in a foreign central bank’s claims on the home country impli...

Under fixed rates, which one of the following statements is the most accurate?A.Monetary policy can affect onlyB.Monetary policy can affect onlyC.Monetary policy can affect only in...

A.A devaluation occurs when the central bank lowers the domestic currency price of foreign currency, E, and a revaluation occurs when the central bank raisesB.A devaluation occurs ...

Under fixed exchange rate, which one of the following statements is the most accurate?A.Devaluation causes a decrease in output, a decrease in official reserves, and a contraction ...

Under fixed exchange rate, which one of the following statements is the most accurate?A.Devaluation causes a rise inB.Devaluation causes a decrease inC.Devaluation has no effect on...

Answer: When a currency is devalued from E0 to E1, the equilibrium shifts from point 1 to 2. Both output and money supply increase. And international reserves increase. 

Under the price-specie-flow mechanism, what happens when Germany’s current account surplus is greater than its non-reserve financial account deficits?A.German loans will finance a...

The “rules of the game” under the gold standard can best be described as which of the following?A.Selling domestic assets in a deficit and buying assets in a surplusB.Slowing dow...

A.avoiding excessive imbalances in internationalB.a balance between exports andC.a balance between trade account and serviceD.a fixed exchangeE.None of theAnswer: A

A.balance in the country’s currentB.balance in the country’s serviceC.balance in the country’s financialD.balance in the country’s tradeE.None of theAnswer: E

A.central banks tried to have sharp fluctuations in the balance ofB.central banks tried to avoid sharp fluctuations in the current account of the balance ofC.central banks tried to...