Author Question: Suppose the Fed wants to fix the U.S. dollar/Mexican peso rate at 11 pesos per dollar under a fixed ... (Read 149 times)

sammy

  • Hero Member
  • *****
  • Posts: 818
Suppose the Fed wants to fix the U.S. dollar/Mexican peso rate at 11 pesos per dollar under a fixed exchange rate policy. If the exchange rate falls to 10 pesos per dollar, the Fed can
 
  A) buy dollars.
  B) sell dollars.
  C) attempt to freeze all sales of dollars.
  D) any of the above actions could take place.

Question 2

When the Fed buys U.S. government securities from a bank, the Fed
 
  A) loans the money needed to buy the securities to the bank.
  B) increases the bank's reserves at the Fed.
  C) obtains the money for the purchase from the U.S. Treasury.
  D) decreases the monetary base and raises the federal funds rate.



josephsuarez

  • Sr. Member
  • ****
  • Posts: 323
Answer to Question 1

A

Answer to Question 2

B



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

Eating food that has been cooked with poppy seeds may cause you to fail a drug screening test, because the seeds contain enough opiate alkaloids to register as a positive.

Did you know?

In the United States, congenital cytomegalovirus causes one child to become disabled almost every hour. CMV is the leading preventable viral cause of development disability in newborns. These disabilities include hearing or vision loss, and cerebral palsy.

Did you know?

Autoimmune diseases occur when the immune system destroys its own healthy tissues. When this occurs, white blood cells cannot distinguish between pathogens and normal cells.

Did you know?

There are approximately 3 million unintended pregnancies in the United States each year.

Did you know?

A recent study has found that following a diet rich in berries may slow down the aging process of the brain. This diet apparently helps to keep dopamine levels much higher than are seen in normal individuals who do not eat berries as a regular part of their diet as they enter their later years.

For a complete list of videos, visit our video library