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Question: Which of the following statements is correct for an open economy that has a fixed exchange rate?

a.

The domestic money supply is affected by the balance of payments
b.

Its inflation rate is unaffected by inflation rates in the rest of the world
c.

Interest rates are determined solely by the domestic demand for and supply of credit
d.

A current account deficit is always matched by net inflows of private capital
e.

None of the above