In the Mundell-Fleming Model

question 30

Multiple Choice

In the Mundell-Fleming model:

• A)the exchange rate system must have a floating exchange rate.
• B)the exchange rate system must have a fixed exchange rate.
• C)it makes no difference whether the exchange rate system has a floating or a fixed exchange rate.
• D)the behavior of the economy depends on whether the exchange rate system has a floating or a fixed exchange rate.

---

Definitions:

GDP

Gross Domestic Product; a monetary measure of the market value of all final goods and services produced in a country during a specific period.

Modernization

The process through which societies transform economically, socially, and culturally to adopt the characteristics of modern societies.

Anthropological Approach

A method in anthropology that involves the study of human societies, cultures, and their development.

Better World

The concept refers to an ideal or improved state of the world where social, economic, and environmental conditions are enhanced for the wellbeing of all its inhabitants.