In a situation of flexible exchange rates and where the BP curve is steeper than the LM curve,

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If the BP curve is steeper than the LM curve, this indicates that the economy is more sensitive to changes in fiscal policy than monetary policy. Therefore, expansionary fiscal policy will be more effective in raising the level of national income than would be the case under fixed exchange rates. This is because under fixed exchange rates, the exchange rate is fixed, and any increase in national income would lead to an increase in imports, resulting in a balance of payments deficit. However, under flexible exchange rates, the exchange rate can adjust to reflect changes in the economy, helping to offset any potential balance of payments issues.

In a Situation of Flexible Exchange Rates and Where the BP