Question: Starting from point E in Figure 18.8, draw a figure showing how the nation could reach internal and external balance with flexible exchange rates by

Starting from point E in Figure 18.8, draw a figure showing how the nation could reach internal and external balance with flexible exchange rates by using an expansionary fiscal rather than an easy monetary policy.
Figure 18.8

BP LM LM 5.0 4.5 LM 2.5 is' IS Ye=1000 YE-1400 Y =1500

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