Under a Fixed Exchange Rate System and a Neutral Monetary

question 91

Multiple Choice

Under a fixed exchange rate system and a neutral monetary policy, an expansionary fiscal policy will be reinforced by an open economy because of the resultant capital _____ U.S. capital markets, which _____ interest rates.

• A) outflow from; reduces
• B) outflow from; increases
• C) inflow to; reduces
• D) inflow to; increases

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Definitions:

Monetary Rewards

Financial incentives offered to employees as recognition for their work performance, achievements, or to motivate specific behaviors.

Stock Options

A benefit often granted to employees, giving them the right to buy the company's stock at a fixed price within a specific period.

Incentives

Rewards or bonuses given to employees or teams to motivate performance and achieve specific business outcomes.

Factors

Variables or elements that contribute to a particular outcome or situation; can be economic, social, technological, or of any nature depending on the context.