In the Mundell-Fleming model with a floating exchange rate, a rise in the world interest rate will lead income:
A) and net exports both to fall.
B) to rise and net exports to fall.
C) to fall and net exports to rise.
D) and net exports both to rise.

Question

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The Answer of In the Mundell-Fleming model with a floating exchange rate, a rise in the world interest rate will lead income:
A) and net exports both to fall.
B) to rise and net exports to fall.
C) to fall and net exports to rise.
D) and net exports both to rise.

In the Mundell-Fleming Model with a Floating Exchange Rate, a Rise