In the Mundell-Fleming Model, If the Economy Is Operating at or Below

question 14

Multiple Choice

In the Mundell-Fleming model, if the economy is operating at or below the natural level in the short run, then in the long run the price level will fall, the exchange rate will ______, and net exports will ______ to restore the economy to its natural rate.

• A) appreciate; increase
• B) appreciate; decrease
• C) depreciate; increase
• D) depreciate; decrease

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Definitions:

Perceived Social Support

an individual's belief or perception regarding the availability and efficacy of emotional, informational, and material support from their social network.

Religious Involvement

Participation in or commitment to activities and practices associated with a particular faith or belief system.

Optimism

A mindset defined by optimism and belief in a successful and positive outcome.

Received Support

The perception or experience of having support available from others in times of need, which can significantly impact an individual's stress levels and well-being.