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Initially the exchange rate between South Korea and Tunisia is in equilibrium. Now assume that there is an increase in supply of Tunisian dinar. 1. As a result of an increase in supply of Tunisian dinar, what will happen to South Korean won and Tunisian dinar?
Furthermore, an increase in supply of Tunisian dinar also results in winners and losers for various groups that are affected by the foreign exchange market. For the following list of groups you must indicate which groups are winners and losers by moving the labels into each slot.
A. A tourist from South Korea going on vacation to Tunisia.
B. A mutual fund in South Korea that is going to purchase bonds in Tunisia.
C. A family from Tunisia visiting relatives in South Korea.
D. A small firm in Tunisia that sells DoDads in South Korea.
E. A large firm from South Korea selling chemicals in Tunisia.
F. A multinational based in Tunisia purchasing land in South Korea.
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