Under Fixed Exchange Rates and a Constant Price Level, the Automatic

Multiple Choice

Under fixed exchange rates and a constant price level, the automatic adjustment process produces balance-of-payments equilibrium as

A) the LM curve shifts along the fixed IS and BP curves.
B) the IS curve shifts along the fixed LM and BP curves.
C) the IS, LM, and BP curves all shift.
D) the BP curve shifts to the point where the IS and LM curves intersect.