1. CHAPTER 6. Fixed Prices: The Mundell – Fleming Model
The Setting
Equilibrium
Monetary Expansion With A Floating Exchange Rate
Fiscal Expansion With A Floating Exchange Rate
Monetary Expansion With A Fixed Exchange Rate
Fiscal Expansion With A Fixed Exchange Rate
The Monetary And The Mundell-Fleming Model Compared

2. The Setting
AS is flat
PPP does not hold
Exchange Rate Expectations are static
Capital Mobility is less than perfect

3. Equilibrium and Monetary expansion Under Floating Rates

4. Fiscal Expansion Under Floating Rates

5. Monetary Expansion Under Fixed Rates

6. Fiscal Expansion Under Fixed Rates