If Price Expectations Are Assumed to Be Correct,money Demand Is

question 88

Multiple Choice

If price expectations are assumed to be correct,money demand is proportional to income,and there are no international capital flows,then the big,comprehensive model corresponds to which of the following special cases?

• A) classical closed economy
• B) classical open economy
• C) IS-LM model
• D) Mundell-Fleming with floating exchange rate

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