Under a fixed exchange rate system with perfect capital mobility, what happens when the government increases its spending?
In a fixed exchange rate system with perfect capital mobility, an increase in government spending shifts the IS curve to the right, increasing output and the interest rate. However, because capital is perfectly mobile, the higher domestic interest rate would attract foreign capital, leading to upward pressure on the exchange rate (appreciation). To maintain the fixed exchange rate, the central bank intervenes by increasing the money supply, which shifts the LM curve to the right, lowering the interest rate back to the world interest rate.
Kissan Call Center (KCC) was started in India in the year
What approximate portion of total rice exports does Non-Basmati White Rice constitute?
Which Indian solar park holds the record for being the largest solar park in the world as of 2022?
T he percentage of NPK (approximately) in Farm Yard Manure (FYM)is?—
Indian Institute of Sugarcane Research (IISR) is situated in
In the G1 phase of cell cycle, each chromosome has chromatid(s).
Which state ranks second in cotton production in India?
T he process of conversion of organic form to inorganic form (mineral form) of nutrient element is called __ ?
For preventing damage by shoot fly in sorghum the seed should be treated with
The insecticide use to control the termites:
