When the Federal Reserve (acting through member commercial banks) sells U.S. dollars in the foreign exchange market, it _____ the supply of U.S. dollars and hence tends to _____ the value of the U.S. dollar relative to other currencies. a. increases, raise b. decreases, lower c. increases, lower d. decreases, raise A high rate of inflation within a country will tend to _____ the value of its currency with respect to the currencies of other countries that are experiencing lower rates of inflation. a. increase b. decrease c. have no effect on d. cannot be determined because of insufficient information Firms transacting business with foreign companies can lower exchange rate risk exposure by a. limiting transaction exposure b. hedging c. purchasing LIBORs d. none of the above