True or False?
The statement is false. The shift of investment from Country A to Country B puts leftward pressure on A's IS curve and rightward pressure on B's IS curve, creating downward pressure on output, income, and the demand for money in A and upward pressure on output, income and the demand for money in B. As this happens, A-residents will try to sell gold to B-residents in return for non-monetary assets and B-residents will try to sell non-monetary assets to A-residents for silver. The price of gold will fall relative to the price of silver, increasing A's exports to B and reducing B's exports to A by sufficient amounts to maintain the IS curves of countries A and B in their original positions. No change in employment and prices occur.