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    Applied International Economics
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    Exam 17: Macroeconomic Policy and Floating Exchange Rates
  5. Question
    Why Is Fiscal Policy Relatively Ineffective If Exchange Rates Are
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Why Is Fiscal Policy Relatively Ineffective If Exchange Rates Are

Question 7

Question 7

Short Answer

Why is fiscal policy relatively ineffective if exchange rates are allowed to adjust to their equilibrium level?

Correct Answer:

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Fiscal policy refers to the use of gover...

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