Other Things Equal, a Domestic Monetary or Financial Shock (A

Multiple Choice

Other things equal, a domestic monetary or financial shock (a shift in the LM curve) Tends to produce what relative degree of GDP change for the home country under a Situation of flexible exchange rates compared to a situation of fixed exchange rates?

A) smaller change with flexible rates
B) same change with flexible rates as with fixed rates
C) larger change with flexible rates
D) smaller, same, or larger change with flexible rates - cannot be determined without more information