Under a Floating Exchange Rate Regime, in the Very Short

question 2

Multiple Choice

Under a floating exchange rate regime, in the very short run (before the exchange rate adjusts) , expansionary fiscal policy will lead to:

• A)improvement in both current account and financial account.
• B)improvement in current account but deterioration in financial account.
• C)deterioration in current account but improvement in financial account.
• D)deterioration in both current account and financial account.

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Definitions:

Organizations

Groups of people who work together in structured and coordinated ways to achieve a set of goals or objectives.

Labour Unions

Organizations formed by workers to protect their rights and interests through collective bargaining with employers.

Labour-Management Relations

The interactions between employees, often represented by unions, and employers concerning workplace decisions, wages, working conditions, and disputes.

Work Environment

The setting, conditions, and culture in which an employee performs their job, including physical, psychological, and social factors.