Author Question: In the New Keynesian open economy model, if the exchange rate is fixed A) fiscal policy and ... (Read 50 times)

dejastew

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In the New Keynesian open economy model, if the exchange rate is fixed
 
  A) fiscal policy and monetary policy are powerless.
  B) fiscal policy is an effective stabilization tool.
  C) a change in current total factor productivity increases output.
  D) monetary policy is an effective stabilization tool.

Question 2

An increase in the general level of prices will tend to cause, other things the same ________.
 
  A) an increase in the real value of assets
  B) an increase in the real value of liabilities
  C) no change in the real value of liabilities
  D) a decrease in the real value of liabilities



brittrenee

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Answer to Question 1

B

Answer to Question 2

D



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