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Suppose policy makers are pursuing a policy to fix the exchange rate. In such a system with perfect ...

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Suppose policy makers are pursuing a policy to fix the exchange rate. In such a system with perfect ...

Suppose policy makers are pursuing a policy to fix the exchange rate. In such a system with perfect capital mobility, an open market sale of domestic bonds by the domestic central bank will eventually result in
A) a permanent increase in the monetary base.
B) a permanent reduction in the monetary base.
C) a gradual reduction in the domestic interest rate.
D) a change in the composition of the monetary base.

Textbook

Macroeconomics

Edition: 6^th

Authors: Blanchard, Johnson

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Roar Author

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6 years ago

Thanks

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Thanks for your help!!

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