The Assignment Rule Says That, with Fixed Exchange Rates, Fiscal

question 53

True/False

The assignment rule says that, with fixed exchange rates, fiscal policy should be used to stabilize the balance of payments and monetary policy should be used to stabilize the domestic economy.

---

Definitions:

Elastic

Describes a situation where the quantity demanded of a good or service significantly responds to changes in price.

Oligopoly Pricing

A market pricing strategy used in an oligopoly, where a few firms dominate the market and can significantly influence prices through competitive and collaborative dynamics.

Sticky

Describes prices or wages that are slow to adjust or change in response to changes in supply, demand, or the broader economic environment.

Price Discrimination

A pricing policy in which the same provider sells the same or nearly the same products or services at various prices across different markets.