The Aggregate Demand Curve for an Open Economy Under Fixed

question 10

Multiple Choice

The aggregate demand curve for an open economy under fixed exchange rates is

• A)less elastic than if the economy were closed
• B)more elastic than in the economy were closed
• C)more elastic than in the economy operated with flexible exchange rates
• D)all of the above

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Definitions:

Multidomestic Corporation

A company that operates in multiple countries, tailoring products, marketing, and operations to fit the cultural and societal needs of each location.

Third-Country National

An employee who is a citizen of one country, working in a second country, and employed by an organization headquartered in a third country.

Home-Country National

A term referring to employees who are working in their country of origin.

Hammer

A tool with a heavy head and a handle, used for breaking things or driving in nails.