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Basic Question 6 of 8

Which model claims that monetary policy affects the exchange rate primarily through the interest rate sensitivity of capital flows?

A. The Mundell-Fleming Model.
B. The Taylor rule.
C. The portfolio balance approach.

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I used your notes and passed ... highly recommended!
Lauren

Lauren

Learning Outcome Statements

explain the potential effects of monetary and fiscal policy on exchange rates;

CFA® 2025 Level II Curriculum, Volume 1, Module 8.