Reference no: EM131901546

1. A foreign exchange intervention in which a central bank allows the purchase or sale of domestic currency to have an effect on the monetary base and hence on the money supply is called a(n):

        sterilized foreign exchange intervention

       unsterilized foreign exchange intervention

       securitized foreign exchange intervention

       unsecuritized foreign exchange intervention

       real darn shame

2. A central bank sale of ________ to purchase _________ in the foreign exchange market results in an equal rise in its international reserves and the monetary base.

        foreign assets, domestic currency

       foreign assets, foreign currency

       domestic currency, foreign assets

       domestic currency, T-bills