Use the following to answer questions :
Exhibit: IS*-LM*
-(Exhibit: IS*-LM*) A small open economy with a fixed exchange rate e2 is initially at equilibrium A with and equilibrium output Y1. If there is an increase in government spending to the new equilibrium will be at ____, holding everything else constant.
A) A
B) B
C) C
D) D
Correct Answer:
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