a)  domestic; foreign

Managerial Economics: A Problem Solving Approach
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ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
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Chapter11: Foreign Exchange, Trade, And Bubbles
Section: Chapter Questions
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31.

Under a fixed exchange rate regime, if the domestic currency is initially undervalued, that is, above par, the central bank must intervene to sell the ________ currency by purchasing ________ assets.

 

Question 31 options:

 

a) 

domestic; foreign

 

b) 

domestic; domestic

 

c) 

foreign; foreign

 

d) 

foreign; domestic

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