Question 13 (5 points) Assuming that the economy is in a recession, then under fixed exchange rates, the government coul

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Question 13 5 Points Assuming That The Economy Is In A Recession Then Under Fixed Exchange Rates The Government Coul 1 (72.29 KiB) Viewed 35 times

Question 13 (5 points) Assuming that the economy is in a recession, then under fixed exchange rates, the government could speed up the adjustment: by revaluing the nominal exchange rate provided the markets were surprised by devaluing the nominal exchange rate provided that markets were informed in advance by adopting a restrictive fiscal policy to improve market confidence by devaluing the nominal exchange rate provided that markets were not informed in advance Question 14 (5 points) Looking at the speed of adjustment under flexible exchange rates: it is not related to the coefficient h we cannot say theoretically what the effect would be when h changes it will be faster the larger is the coefficient h it will be slower the larger is the coefficient h Question 15 (5 points) In the long run, a permanent positive supply shock, which shifts the LRAS curve to the right, will: none of the options shown cause the real exchange rate to appreciate as markets take a positive view of the economy will leave the real exchange rate unchanged due to exchange rate neutrality cause the real exchange rate to depreciate in order to bring demand in line with the now higher potential output