The difference between the simple monetary model and the general monetary model of exchange rate determination in the long run is that:
A) the simple model refers to only one nation, while the general model includes all nations.
B) the simple model has only one equation, while the general model includes a number of simultaneous equations.
C) the simple model assumes a constant demand function for real balances, while the general model assumes that the demand for real balances is a decreasing function of the nominal interest rate.
D) the general model applies to increases and decreases in the relevant variables; the simple model does not allow relevant variables to decrease.
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