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1:Suppose the spot exchange rate between Domestic and Foreign is ED/F =50 and the no 1.2. If ED/F rises to 65 tomorrow, then Domestic has

1:Suppose the spot exchange rate between Domestic and Foreign is ED/F =50 and the no 1.2. If ED/F rises to 65 tomorrow, then Domestic has experienced: A a real depreciation. B a real appreciation. C a nominal depreciation. D a nominal appreciation. minal interest rates in the countries are (iD , iF ) = (0.03, 0.02)

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