Given an Open Economy with High Capital Mobility, Under a System

Multiple Choice

Given an open economy with high capital mobility, under a system of managed-floating exchange rates with heavy exchange rate intervention

A) fiscal policy is more successful in promoting internal balance, while monetary policy is less successful.
B) monetary policy is more successful in promoting internal balance, while fiscal policy is less successful.
C) both fiscal policy and monetary policy are equally successful in promoting internal balance.
D) neither fiscal policy nor monetary policy are successful in promoting internal balance.