5 Questions
According to the Mundell-Fleming model, what does the IS-LM model focus on?
Equilibrating forces in the goods and money markets
In the Mundell-Fleming model, what is assumed about the demand components in the goods market?
C + c·(Y − T )
What is assumed about the capital mobility in a small open economy in the Mundell-Fleming model?
r = r∗
In the Mundell-Fleming model, what is assumed about the short-run exogenous variables?
P and P ∗ exogenous
What is the main focus of the Mundell-Fleming model?
Equilibrating forces in the goods and money markets
This quiz explores the Mundell-Fleming model, its applications, and a case study. Learn about the short-run implications, the combination of the Keynesian Cross and Liquidity Preference models, and the forces that drive equilibrium in the goods and money markets. Test your knowledge on this economic model.
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