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A government has been running budget deficits for many years and decides to balance its budget. Explain how each of the following is affected under

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A government has been running budget deficits for many years and decides to balance its budget. Explain how each of the following is affected under a floating exchange-rate regime. a. The interest rate will: O remain the same. O decrease. O increase. b. The exchange rate value ofthe domestic currency will: O increase. O decrease. O remain the same. c. The trade balance will: O increase. O remain the same. O decrease

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