Question 10 (5 points) Under fixed exchange rates, when fiscal policy is counter-cyclical, the slope of the aggregate de

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Question 10 5 Points Under Fixed Exchange Rates When Fiscal Policy Is Counter Cyclical The Slope Of The Aggregate De 1 (50.16 KiB) Viewed 30 times

Question 10 (5 points) Under fixed exchange rates, when fiscal policy is counter-cyclical, the slope of the aggregate demand curve will flatten will steepen will remain unchanged change sign Question 11 (5 points) If demand shocks are dominate then fluctuations in inflation and output: will be smaller under fixed rates will be smaller under flexible rates will be larger under flexible rates will be the same under each system Question 12 (5 points) The response to inflation will be larger under flexible exchange rates: the larger is the coefficient h the larger is the response of nominal exchange rate to interest rates (0-1) all of the options shown the larger is the sensitivity of the demand to a change in real interest rates (B2)