Question Description
Q4: How does an expansionary fiscal policy affect a small open economy under a fixed exchange rate system with perfect capital mobility?a)It leads to a depreciation of the domestic currency.b)It causes an increase in domestic interest rates.c)It results in capital outflows and a balance of payments surplus.d)It triggers capital inflows and an appreciation of the domestic currency.Correct answer is option 'D'. Can you explain this answer? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about Q4: How does an expansionary fiscal policy affect a small open economy under a fixed exchange rate system with perfect capital mobility?a)It leads to a depreciation of the domestic currency.b)It causes an increase in domestic interest rates.c)It results in capital outflows and a balance of payments surplus.d)It triggers capital inflows and an appreciation of the domestic currency.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Q4: How does an expansionary fiscal policy affect a small open economy under a fixed exchange rate system with perfect capital mobility?a)It leads to a depreciation of the domestic currency.b)It causes an increase in domestic interest rates.c)It results in capital outflows and a balance of payments surplus.d)It triggers capital inflows and an appreciation of the domestic currency.Correct answer is option 'D'. Can you explain this answer?.

Solutions for Q4: How does an expansionary fiscal policy affect a small open economy under a fixed exchange rate system with perfect capital mobility?a)It leads to a depreciation of the domestic currency.b)It causes an increase in domestic interest rates.c)It results in capital outflows and a balance of payments surplus.d)It triggers capital inflows and an appreciation of the domestic currency.Correct answer is option 'D'. Can you explain this answer? in English & in Hindi are available as part of our courses for B Com. Download more important topics, notes, lectures and mock test series for B Com Exam by signing up for free.

Here you can find the meaning of Q4: How does an expansionary fiscal policy affect a small open economy under a fixed exchange rate system with perfect capital mobility?a)It leads to a depreciation of the domestic currency.b)It causes an increase in domestic interest rates.c)It results in capital outflows and a balance of payments surplus.d)It triggers capital inflows and an appreciation of the domestic currency.Correct answer is option 'D'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of Q4: How does an expansionary fiscal policy affect a small open economy under a fixed exchange rate system with perfect capital mobility?a)It leads to a depreciation of the domestic currency.b)It causes an increase in domestic interest rates.c)It results in capital outflows and a balance of payments surplus.d)It triggers capital inflows and an appreciation of the domestic currency.Correct answer is option 'D'. Can you explain this answer?, a detailed solution for Q4: How does an expansionary fiscal policy affect a small open economy under a fixed exchange rate system with perfect capital mobility?a)It leads to a depreciation of the domestic currency.b)It causes an increase in domestic interest rates.c)It results in capital outflows and a balance of payments surplus.d)It triggers capital inflows and an appreciation of the domestic currency.Correct answer is option 'D'. Can you explain this answer? has been provided alongside types of Q4: How does an expansionary fiscal policy affect a small open economy under a fixed exchange rate system with perfect capital mobility?a)It leads to a depreciation of the domestic currency.b)It causes an increase in domestic interest rates.c)It results in capital outflows and a balance of payments surplus.d)It triggers capital inflows and an appreciation of the domestic currency.Correct answer is option 'D'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice Q4: How does an expansionary fiscal policy affect a small open economy under a fixed exchange rate system with perfect capital mobility?a)It leads to a depreciation of the domestic currency.b)It causes an increase in domestic interest rates.c)It results in capital outflows and a balance of payments surplus.d)It triggers capital inflows and an appreciation of the domestic currency.Correct answer is option 'D'. Can you explain this answer? tests, examples and also practice B Com tests.