In a small open economy with a floating exchange rate, an effective policy to increase equilibrium output is to:
A) increase government spending.
B) increase taxes.
C) increase the money supply.
D) decrease the money supply.

Question

Quizplus · Accepted Answer

The Answer of In a small open economy with a floating exchange rate, an effective policy to increase equilibrium output is to:
A) increase government spending.
B) increase taxes.
C) increase the money supply.
D) decrease the money supply.

In a Small Open Economy with a Floating Exchange Rate