9.* An economy has zero net exports. Otherwise, it is identical to the economy described in Problem...
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9.* An economy has zero net exports. Otherwise, it is identical to the economy described in Problem 7. (LO3, LO4, LO5) a. Find short-run equilibrium output. b. Economic recovery abroad increases the demand for the country’s exports; as a result, NX rises to 100. What happens to short-run equilibrium output? c. Repeat part b, but this time assume that foreign economies are slowing, reducing the demand for the country’s exports, so that NX = −100. (A negative value of net exports means that exports are less than imports.) d. How do your results help explain the tendency of recessions and expansions to spread across countries?
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Related Book For
Principles Of Macroeconomics
ISBN: 9781264250356
8th Edition
Authors: Robert Frank, Ben Bernanke, Kate Antonovics, Ori Heffetz
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