What would the overall impact be on the monetary base?

The overall impact of the sterilized intervention is to make a compositional change on the (asset/liabilities) side of the balance sheet while leaving the (liabilities/asset) side unchanged. Therefore, the sterilized intervention (decrease/increase/leaves unchanged) the monetary base and the domestic interest rate does not change.

What would be the impact, if any, on the exchange rate? Assume that the intervention took place in a deep, well-functioning foreign exchange market.

The exchange rate will ____ (increase/decrease/be unchanged.

Suppose that a central bank that is operating on the downward-sloping portion of the reserve demand curve decides to purchase $1,000 worth of foreign exchange reserves and then sterilize this foreign exchange market intervention. Show the impact on the central bank's balance sheet. Suppose that a central bank that is operating on the downward-sloping portion of the reserve demand curve decides to purchase $1,000 worth of foreign exchange reserves and then sterilize this foreign exchange market intervention. Show the impact on the central bank's balance sheet