Why is fiscal policy effective but monetary policy ineffective under fixed exchange rates? Why is the opposite

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Why is fiscal policy effective but monetary policy ineffective under fixed exchange rates? Why is the opposite true under flexible rates?

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International Economics

ISBN: 978-1118955765

12th edition

Authors: Dominick Salvatore

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Question Posted: Oct 27, 2017 09:36 AM

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Why is fiscal policy effective but monetary policy ineffective under fixed exchange rates? Why is the opposite

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With a fixed exchange rate a monetary policy cannot be used to target domestic inflation and to smoo...View the full answer

International Economics

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