If the firm is incurring losses in the short run, then which of the following is true?

Compared to the 1960s, the effectiveness lag is ________ due to ________

A) shorter, changes in fiscal policy B) longer, structural changes in the economy C) shorter, deregulation D) longer, increased sensitivity of consumer spending to interest rates

What is the drawback for a country that chooses to fix its exchange rate?

a. Fixing the exchange rate can deteriorate the international competitiveness because the real exchange rate can't fluctuate anymore. b. Businesses in the country are more exposed to business risks associated with exchange rate changes. c. The central bank loses its ability to influence the money supply, unless severe capital controls are imposed. d. Fixing the exchange rate has no disadvantages and should be adopted by all countries.