The IS/LM/BP Analysis Suggests That, Under Flexible Exchange Rates

Multiple Choice

The IS/LM/BP analysis suggests that, under flexible exchange rates,

A) monetary policy is less powerful for affecting national income than under fixed Exchange rates.
B) a country may have difficulty in staying on the LM curve.
C) expansionary fiscal policy, in theory, may cause either depreciation or appreciation of The home currency.
D) expansionary fiscal policy will always lead to a decline in national income.