Country X has an open economy and a fixed exchange rate. Which mix of fiscal and monetary policies would be most effective in bringing deflation to an end?
- Afiscal policy: lower direct taxes; monetary policy: devaluation
- Bfiscal policy: lower direct taxes; monetary policy: revaluation
- Cfiscal policy: lower indirect taxes; monetary policy: devaluation
- Dfiscal policy: lower indirect taxes; monetary policy: revaluation