Using the IS-LM-BP Model with the Perfect Capital Mobility Assumption

question 12

Multiple Choice

Using the IS-LM-BP model with the perfect capital mobility assumption to answer this question.Which of the following statements is TRUE?
I.In a floating exchange rate regime,fiscal policy is effective in stimulating income.
II.In a floating exchange rate regime,monetary policy is effective in stimulating income.

• A) Only I is true.
• B) Only II is true.
• C) Both I and II are true
• D) Neither I nor II is true.

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Definitions:

Raymond Moody

A psychologist and author best known for his work on life after death and near-death experiences, introducing the concept of the near-death experience in his book, "Life After Life."

Life After Life

A concept or belief related to existence, experiences, or realities that may occur after death.

Near-Death Experiences

Phenomena where individuals report experiencing vivid encounters or perceptions during moments of clinical death or extreme physical distress.

Empirical Evidence

Information acquired by observation or experimentation that is used to validate or disprove a hypothesis or theory in scientific research and real-world applications.