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If Boblandia had a flexible exchange rate, it would cost 10 Bobos to purchase a Canadian dollar. The Central Bank of Boblandia (aka, the Bank
If Boblandia had a flexible exchange rate, it would cost 10 Bobos to purchase a Canadian dollar. The Central Bank of Boblandia (aka, the Bank of Boblandia, or BoB) has fixed the exchange rate, saying it will buy or sell Bobos at C$0.12 for each Bobo. Which of the following represents a choice it is currently facing? In order to not have to buy Canadian dollars, it could buy bonds from domestic banks. In order to not have to buy Canadian dollars, it could sell bonds to domestic banks. In order to not have to sell Canadian dollars, it could buy bonds from domestic banks. In order to not have to sell Canadian dollars, it could sell bonds to domestic banks
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