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Q. Explain why one can write the demand for money as follows: Md = P L (R, Y)
Answer: The collective money demand is proportional to the price level. Imagine that every prices in an economy doubled except the interest rate and everyone's real incomes remained unchanged. After that the money value of each individual's average daily transactions would then simply double the same as would the amount of money each wishes to hold.
Q. Explain how an increase in the real exchange rate affects exports and imports. Answer: While the real exchange rate rises domestic products are cheaper relative to
Q. The United States seems at times to have a totally schizophrenic attitude toward protectionism. The United States was the country that proposed the establishment of the World
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Importance of International Trades : The basis of international trade is to be found in the diversity of economic resources in different countries. All countries have not been end
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Research about the effects of the Nationalization in terms of: Economic effect of nationalization -International -What is happening to FDI? How it has affected other inter
Q. What is the national income identity for an open economy? Answer: Y = C + I + G + EX - IM.
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