Let's say a country face temporary/permanent increase in the demand for imports that is exogenous. The country has a fixed exchange rate for its currency. Use a DD-AA diagram to answer the question.

a) Indicate any movement(s) of the curves on your diagram that can be observed as a result of this activity. Explain the reasons for the shift(s).What happens to the exchange rate, E, as a result? What happens to national income, Y, as a result?