In the open-economy macroeconomic model, if there were a surplus in the market for foreign-currency exchange, the real exchange rate would appreciate. a. True b. False
Answer)
In the open-economy macroeconomic model, if there were a surplus in the market for foreign-currency exchange, the real exchange rate would depreciate and the net exports would rise. So, the statement is False.
Answer is False.
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In the open-economy macroeconomic model, if there were a surplus in the market for foreign-currency exchange,...
In the open-economy macroeconomic model, if the supply of loanable funds shifts right Group of answer choices the interest rate falls and the supply of dollars in the market for foreign-currency exchange shifts right. the interest rate falls and the supply of dollars in the market for foreign currency exchange shifts left. the interest rate rises and the demand for dollars in the market for foreign currency exchange shifts right. the interest rate rises and the demand for dollars in...
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In an open economy, what is the source of demand for dollars in the foreign-currency exchange market? Net exports Net capital outflow National saving Imports
Use the model of the small open economy (Apply the small open economy model of real exchange rate determination ) to predict what would happen to the trade balance, the real exchange rate, and the nominal exchange rate in response to each of the following events. draw a graph (be sure to label all points, shifts and curves) and provide a short verbal analysis of the impact on the trade balance, the real exchange rate and the nominal exchange rate)....
When the foreign exchange market determines the relative value of a currency, we say that the country is adhering to a pegged exchange rate regime. True False
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