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Under fixed exchange rates when fiscal policy is not systematic, a temporary increase in government spending will: Question 13 options: create a cycle in the
Under fixed exchange rates when fiscal policy is not systematic, a temporary increase in government spending will: Question 13 options: create a cycle in the real exchange rate, where it will first appreciate, then depreciate and finally appreciate back towards equilibrium cause the real exchange rate to appreciate and then slowly depreciate back to equilibrium cause the real exchange rate to depreciate and then slowly appreciate back to equilibrium cause the real exchange rate to depreciate to new equilibrium
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