Consider two countries with fixed exchange rate regimes. In one country, government authorities exert fiscal dominance. In
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Exchange Rate
The value of one currency for the purpose of conversion to another. Exchange Rate means on any day, for purposes of determining the Dollar Equivalent of any currency other than Dollars, the rate at which such currency may be exchanged into Dollars...
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If a country has fiscal dominance this means that the central bank is forced to finance budget defic...View the full answer
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Related Book For 
International Economics
ISBN: 978-1429278447
3rd edition
Authors: Robert C. Feenstra, Alan M. Taylor
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