Under a Fixed Exchange Rate Regime,suppose There Is a Reduction

question 17

Multiple Choice

Under a fixed exchange rate regime,suppose there is a reduction in housing wealth that causes a reduction in consumption.This wealth-induced reduction in consumption will cause

• A)a reduction in investment.
• B)an increase in net exports.
• C)a reduction in imports.
• D)all of the above
• E) none of the above

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