Question

Discuss according to the Mundell-Fleming model, the effect of almost any economic policy on a small open economy depends on whether exchange rate is floating or fixed. Be sure to include an appropriate graph in your answer.

Answer 1

Answer:

• The Mundell-Fleming model shows that the effect of almost any economic policy on a small open economy depends on whether the exchange rate is floating or fixed.
• The Mundell-Fleming model shows that the power of monetary and fiscal policy to influence aggregate demand depends on the exchange rate regime

Here is your answer bro..

Please mark me as brainliest..