Multiple Choice
The figure below shows an IS-LM-FE model for an economy with fixed exchange rates. Initially the economy is at point A, a triple intersection. Here, the FE curve is steeper than the LM curve. 
At point B, the economy is experiencing:
A) a deficit in the overall balance of payments.
B) a surplus in the overall balance of payments.
C) an overall balance of payments that is in equilibrium.
D) an expanding money supply.
Correct Answer:
Verified
Correct Answer:
Verified
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