Question 7 (10 points) Suppose that the government of a small open economy with perfect capital mobility wants to establish a "stronger" currency by moving its exchange rate higher. Suggest both an appropriate monetary policy adjustment and an appropriate fiscal policy adjustment that would allow the economy to move to a higher exchange rate. What are the consequences of these adjustments on domestic output and net exports? Please illustrate and explain your answers graphically. Be sure to label: i. the axes, ii. the curves, iii. the initial equilibrium levels, iv. the direction the curves shift, and v. the new short-run equilibrium