d. Again, suppose you wanted to make domestic industries more competitive but did not want to alter aggregate income. Assuming now a fixed exchange rate, what policy or combination of policies should you pursue, according to the Mundell-Fleming model? Revaluation Contractionary monetary Expansionary fiscal Contractionary fiscal Devaluation Expansionary monetary

d. Again, suppose you wanted to make domestic industries more competitive but did not want to alter aggregate income. Assuming now a fixed exchange rate, what policy or combination of policies should you pursue, according to the Mundell-Fleming model? Revaluation Contractionary monetary Expansionary fiscal Contractionary fiscal Devaluation Expansionary monetary

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter29: Exchange Rates And International Capital Flows

Section: Chapter Questions

Problem 25CTQ: If a countrys currency is expected to appreciate in value, what would you think will be the impact...

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Question

d. Again, suppose you wanted to make domestic industries more competitive but did not want to alter aggregate
income. Assuming now a fixed exchange rate, what policy or combination of policies should you pursue, according to
the Mundell-Fleming model?
Revaluation
Contractionary monetary
Expansionary fiscal
Contractionary fiscal
Devaluation
Expansionary monetary

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