In the Mundell Prescription for Monetary and Fiscal Policy Under

Multiple Choice

In the Mundell prescription for monetary and fiscal policy under fixed exchange rates, expansionary fiscal policy and contractionary monetary policy would be recommended if a country were faced with

A) unemployment and a balance-of-payments deficit.
B) unemployment and a balance-of-payments surplus.
C) inflation and a balance-of-payments deficit.
D) inflation and a balance-of-payments surplus.