How developments affected the real exchange rate in gb

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Question: The British pound appreciated (in real terms) significantly between 1977 and 1981. Find two main reasons for this appreciation. Look for these two reasons in the behavior of oil prices (one of Great Britain's important exports) and in the type of monetary policy conducted by the administration of Prime Minister Margaret Thatcher. Explain how these two developments affected the real exchange rate in GB.

Reference no: EM131789867

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