1. Small Open Economy Model Use the aid of diagrams of the Market for Loanable Funds and the Market for Foreign Currency Exchange to describe what would happen to the net capital outflow, the Canadian real exchange rate and net exports in each scenario. a. The world interest rate falls. b. The government budget deficit increases. C. Canada removes an import quota on automobiles. d. Canadian citizens start saving more as a result of the introduction of Tax Free Savings Accounts. e. There is an increase in the perceived risk of holding Canadian assets