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Q. Based on the case study, answer the following question: Can currency boards make low-inflation policies credible? Answer: Currency boards have the power to bring in anti-
What are the two main base of foreign trade ?
Canadian consumers have 50 dollar in come this is eual to the gross domestic product. they spand 35 dollars on comuser goods (25 on canadian goods annd 10 on imports) they save 8
Q. A naïve implication of the DD - AA framework is that either fiscal or monetary policy can lead to full employment. Discuss why this view is naïve. Answer: 1. Inflation m
explain the newo clacical theory of international trede
explain the basis for international trade
Explain why Relative PPP is useful when comparing countries that base their price levels on different product baskets. Answer: For instance If the U.S price level increase by
Q. One of the usually used assumptions in deriving the Heckscher-Ohlin model is that tastes are homothetic, or that if the per capita incomes were the similar in two countries, th
Illustration of reciprocal demand through example
Q. Present and explain the Fundamental Equation of the Monetary Approach. Answer: Suppose E$/E = PUS/PE and that domestic price levels depend on domestic money demand
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