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Suppose you travel to Cali Colombia, where the forced exchange rate is 1 USD to 2,900 Colombian pesos. Assume that a Big Mac costs $5

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Suppose you travel to Cali Colombia, where the forced exchange rate is 1 USD to 2,900 Colombian pesos. Assume that a Big Mac costs $5 in the United States. As you enter a McDonald's restaurant, you realize you need 17.400 Colombian pesos to buy a Big Mac Which type of foreign market intervention must the central bank of Colombia conduct to keep the exchange rate at a level where the currency is not under or overvalued in terms of PPP? O A. The central bank of Columbia should undertake an unsterilized foreign market intervention in which it sells the domestic currency (COP) and purchases foreign assets OB. The central bank of Columbia should undertake an unsterilized foreign market intervention in which it buys the domestic currency (COP) and sells foreign reserves OC. The central bank of Columbia should undertake a sterilized foreign market intervention in which it tries to influence the interest differential between domestic and foreign assets OD. The central bank of Columbia should undertake a sterlized foreign market intervention in which it reduces the amount of foreign securities relative to domestic securities in the hands of the public

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