Question: only need the answer of question (c) Exercise 5 Problem One.~ Comparing monetary expansion and fiscal expansion with a fixed exchange rate in the Mundell-Fleming

only need the answer of question (c)

Exercise 5 Problem One.~ Comparing monetary expansion and fiscal expansion with a fixed exchange rate in the Mundell-Fleming model a. Explain the short-run and long-run consequence of a monetary expansion under fixed rate according to Figure5.1~ S LM(DC,, FX,) LM(DCo, FXo) BP ro To LM(DC,, FX.) FF(1) FF(%) H IS -.... S (a) yo (b) yo E yo 450 v (c) (d) Figure 5.1 Monetary expansion under fixed rates in the M-F model b. Explain the short-run and long-run consequence of a fiscal expansion under fixed rate according to Figure5.2

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