Solution-Illustrate the effects of the shock

Illustrate the effects of the shock

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For each of the following situations, use IS-LM-FX model to illustrate the effects of the shock. For each case, state the effect of the shock on the following variables (increase, decrease, no change or ambiguous): Y, I, E, C, I, TB. Assume that the government allows the exchange rate to float and makes no policy response.

Reference no: EM132554719

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Illustrate the effects of the shock

Reference no: EM132554719

Reference no: EM132554719

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