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Basic Question 4 of 6
Which statement is true regarding the effectiveness of central bank intervention?
B. Some studies find that compared to their developed country counterparts, EM policymakers can exert a bigger influence on the level and path of their exchange rates.
C. A study by Magud, Reinhard and Rogoff concludes that capital controls on inflows make monetary policy more dependent on a country's FX policy.
A. Central bank intervention can be very effective in developed countries due to their well-developed financial markets.
B. Some studies find that compared to their developed country counterparts, EM policymakers can exert a bigger influence on the level and path of their exchange rates.
C. A study by Magud, Reinhard and Rogoff concludes that capital controls on inflows make monetary policy more dependent on a country's FX policy.
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Learning Outcome Statements
describe objectives of central bank or government intervention and capital controls and describe the effectiveness of intervention and capital controls;
CFA® 2025 Level II Curriculum, Volume 1, Module 8.