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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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