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Mundell-Fleming: הנחות, Mundell-Fleming exchange rate — True or False?
The assumption of an economy with unemployment (sticky prices) is what allows output to be determined by aggregate demand in the IS-LM model. A) True B) False C) Can't be determined Answer: TRUE True. In a situation of unemployment and idle resources, prices are sticky and the supply of output is "horizontal" over the relevant range. Therefore ...
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