In a Small Open Economy, If the Introduction of Automatic-Teller

question 24

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) and the real exchange rate remain unchanged.

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