What is likely to happen to the exchange rate in a small open economy that engages in trade policy that restricts imports? a.the exchange rate will not be affected b.the exchange rate will appreciate c.the exchange rate will depreciate d.the exchange rate increases but then returns to its original position Clear my choice

Brief Principles of Macroeconomics (MindTap Course List)
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ISBN:9781337091985
Author:N. Gregory Mankiw
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Chapter13: Open-economy Macroeconomics: Basic Concepts
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What is likely to happen to the exchange rate in a small open economy that engages in trade policy that restricts imports?

a.the exchange rate will not be affected
b.the exchange rate will appreciate
c.the exchange rate will depreciate
d.the exchange rate increases but then returns to its original position
Clear my choice
 
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