Figure 13.1 -Refer to Figure 13.1.Starting from an equilibrium point A,if the LM curve shifts to the left to LM₂, A) there will be official settlement deficit which pressures the domestic currency to depreciate. B) there will be official settlement deficit which pressures the domestic currency to appreciate. C) there will be official settlement surplus which pressures the domestic currency to depreciate. D) there will be official settlement surplus which pressures the domestic currency to appreciate.

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The Answer of Figure 13.1 -Refer to Figure 13.1.Starting from an equilibrium point A,if the LM curve shifts to the left to LM₂, A) there will be official settlement deficit which pressures the domestic currency to depreciate. B) there will be official settlement deficit which pressures the domestic currency to appreciate. C) there will be official settlement surplus which pressures the domestic currency to depreciate. D) there will be official settlement surplus which pressures the domestic currency to appreciate.

Figure 13.1 -Refer to Figure 13.1.Starting from an Equilibrium Point A,if the Point