With the help of diagrams, explain the effects of expansionary and contractionary monetary and fiscal policies on output, price level, exchange rate and net exports under fixed and flexible exchange rate regimes in a small open economy with perfect capital mobility.

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A: *Answer:

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A: "As per the classical growth theory a country's economy act as self-regulating."

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A: Dear student, you have asked multiple sub-part questions in a single post.In such a case, I will be…

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