To Offset an Appreciation of the Dollar Against the Yen

Multiple Choice

To offset an appreciation of the dollar against the yen, other things equal, the Federal Reserve would

A) sell dollars on the foreign exchange market and lower domestic interest rates.
B) sell dollars on the foreign exchange market and raise domestic interest rates.
C) buy dollars on the foreign exchange market and lower domestic interest rates.
D) buy dollars on the foreign exchange market and raise domestic interest rates.