[CUT-C120] China is considered as a country with xed exchange rate regime. in November 2008, the Chinese government announced a 4 trillion RMB stimulus package {a rise in government spending} as an attempt to minimize the impact of global financial crisis. Use the open economy IS-LM-FX model to analyze the effect of this policy. What will be the effect of the shock on the short run values of the following variables? Assume trade balance is dependent upon exchange rate only. 17. output: (a) rise {b} fall (c) no change {d} ambiguous 18. interest rate: (a) rise {b} fall (c) no change {d} ambiguous 19. exchange rate {RMB/$}: (a) rise (b) fall (c) no change {d} ambiguous 20. trade balance: (a) rise (b) fall (c) no change {d} ambiguous