Consider an open economy with flexible exchange rates. Suppose output is at the natural level, but there

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Consider an open economy with flexible exchange rates. Suppose output is at the natural level, but there is a trade deficit. The goal of policy is to reduce the trade deficit and leave the level of output at its natural level.

What is the appropriate fiscal and monetary policy mix?

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Macroeconomics

ISBN: 9780134897899

8th Edition

Authors: Olivier Jean Blanchard

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Question Posted: Mar 11, 2024 03:00 AM

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Consider an open economy with flexible exchange rates. Suppose output is at the natural level, but there

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Macroeconomics

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