According to the traditional view concerning government debt (as in the Mundell-Fleming model),if taxes are cut without cutting government spending,then the short-run effects are a(n)______ the Canadian dollar and a(n)______ in net exports.

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According to the Mundell-Fleming model, a tax cut without a corresponding cut in government spending increases the budget deficit, leading to higher interest rates. Higher interest rates attract foreign capital, causing the Canadian dollar to appreciate. An appreciated currency makes exports more expensive and imports cheaper, resulting in a decrease in net exports.

According to the Traditional View Concerning Government Debt (As in the Mundell-Fleming