Multiple Select QuestionSelect all that applyWhich of the following are part of a central bank's official reserves that it uses to maintain a fixed exchange rate?Multiple select question.Foreign currencyForeign bondsGoldBalance of payments
Question
Multiple Select QuestionSelect all that applyWhich of the following are part of a central bank's official reserves that it uses to maintain a fixed exchange rate?Multiple select question.Foreign currencyForeign bondsGoldBalance of payments
Solution
The parts of a central bank's official reserves that it uses to maintain a fixed exchange rate include:
- Foreign currency
- Foreign bonds
- Gold
The balance of payments is not part of a central bank's official reserves. It is a record of all transactions made by a country compared to the rest of the world over a period of time.
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