Which One of the Following Statements Is the MOST Accurate

question 38

Multiple Choice

Which one of the following statements is the MOST accurate?

• A) Fiscal policy has the same effect on output under fixed and flexible exchange rate regimes.
• B) Fiscal policy affects output more under fixed than under flexible exchange rate regimes.
• C) Fiscal policy affects output less under fixed than under flexible exchange rate regimes.
• D) Fiscal policy cannot affect output under fixed exchange rate but does affect output under flexible exchange rate regimes.
• E) Fiscal policy can affect output under fixed exchange rate but does not affect output under flexible exchange rate regimes.

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Definitions:

Applied Research

A type of research intended to solve practical problems by applying scientific principles and theories.

Accuracy

The degree to which the result of a measurement, calculation, or specification conforms to the correct value or a standard.

Testimony

In the context of evidence, testimony refers to the statement or declaration of a witness under oath or affirmation, usually in a court of law.

Environmental Change

Any alteration in the conditions, function, or structure of an environment caused by natural phenomena or human activities.