In a Small Open Economy, If the Introduction of Automatic

question 41

Multiple Choice

In a small open economy, if the introduction of automatic teller machines reduces the demand for money, then net exports:

• A)fall, and the real exchange rate falls.
• B)fall, but the real exchange rate remains unchanged.
• C)remain unchanged, but the real exchange rate falls.
• D)increase, and the real exchange rate remains unchanged.

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