Under Flexible Exchange Rates

Multiple Choice

Under flexible exchange rates,

A) fiscal policy is most effective in influencing national income when capital is perfectly Immobile internationally and least effective when capital is perfectly mobile Internationally.
B) monetary policy is more effective in influencing national income when capital is Perfectly immobile internationally than when capital is perfectly mobile Internationally.
C) both fiscal policy and monetary policy are completely ineffective in influencing National income when capital is perfectly immobile internationally.
D) fiscal policy has no effect on national income, regardless of what assumptions are Made about the degree of international mobility of capital.