Question

1. A central bank that wants to cause its nation's currency to depreciate can do it...

1. A central bank that wants to cause its nation's currency to depreciate can do it best bY

lowering the domestic interest rates.

raising domestic interest rates.

printing money and using it to buy the currency of other countries.

using its store of other countries' money to buy back its own currency

2. Since 2008 the Swiss Central Bank (SNB) has been manipulating the value of its currency. Check all that apply.

It has struggled to minimize the value of its currency.

It has accumulated hundreds of billions of Euros.

It has lowered Swiss Franc interest rates.

The Swiss franc has remained weak since 2008

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Answer #1

a) A central bank that wants to cause its national currency to depreciate can do its best by "A", Lowering the domestic interest rates and Printing money and using it to buy the currency of other countries. Both the options will depreciate the local currency.

b) Swiss central bank has accumulated hundreds of billion of Euros and it struggles to minimize the value of its currency. As it was struggling to increase its export they have to lower the value of Franc they printed more money and accumulated Euros up to 70% of Swiss GDP.Answer is A and B.

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