In a fixed exchange rate regime,an increase in the price level will cause which of the following?
A) a real appreciation and a leftward shift in the aggregate demand curve
B) a real appreciation and no shift in the aggregate demand curve
C) a real depreciation and a rightward shift in the aggregate demand curve
D) a real depreciation and no shift in the aggregate demand curve
E) no change in the real exchange rate, and no change in aggregate demand
Correct Answer:
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