Determine if each statement is True/False
6. An increase in the money supply shifts the LM curve to theright. Â Â
7. Expansionary monetary policy is not effective in increasingdomestic output under floating exchange rate regimes.
8. An increase in G shifts the IS curve to the left.
9. An increase in domestic interest rates increases the capitalaccount. Â Â
10. An increase in e ($/£), a dollar depreciation, should resultin an increase in export revenues.  Â
11. A currency depreciation shifts the BP curve to the left.
12. A decrease in consumption C shifts the IS curve to theright.
13. An increase in interest rates shift the AggregateExpenditure curve to the right. Â Â
14. Expansionary fiscal policy is relatively more effective inincreasing output in a floating exchange rate regime compared to afixed exchange rate regime. Â Â
15. Expansionary monetary policy is relatively more effective inincreasing output in a floating
exchange rate regime compared to a fixed exchange rateregime.
16. According to the GG-LL model optimum currency areas are mostappropriate for areas closely integrated through internationaltrade and factor movements.
17. According to the GG-LL model, an increase in the size andfrequency of shocks in the domestic economy will shift the LL curveto the right.                                                          Â
