- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 8. Currency Exchange Rates: Understanding Equilibrium Value
- Subject 7. Exchange Rate Management: Intervention and Controls
CFA Practice Question
The end result of a typical unsterilized intervention is:
B. Higher interest rates.
C. Stable price level.
A. An increase in the monetary base.
B. Higher interest rates.
C. Stable price level.
Correct Answer: A
It will lead to an increase in the monetary base and decrease in short-term interest rates. Inflation may be a big concern.
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