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In a small open economy with flexible exchange rates, an increase in government's purchases of goods and services would have _________ effects on domestic GDP

In a small open economy with flexible exchange rates, an increase in government's purchases of goods and services would have _________ effects on domestic GDP and ____________ effects on the domestic interest rate in the short run, according to the Mundell-Fleming model.

a.positive; positive

b.positive; no

c.no; no

d.no; positive

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