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Advanced Analysis: Refer to the following table, in which Odis the quantity of loonles demanded, Pis the dollar price of loonies, 05 is the quantity

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Advanced Analysis: Refer to the following table, in which Odis the quantity of loonles demanded, Pis the dollar price of loonies, 05 is the quantity of loonies supplied in year 1, and Os'is the quantity of loonles supplied in year 2. All quantities are in billions. Assume that the exchange rate is xed agalnst the dollar at 115 dollars ='l loonle. Instructions: Enter your answers as whole numbers. a. in year 1. what is the minimum initial size of the U5. reserve of loonies such that the United States can maintain the peg throughout the year? |:] billion loonies b. What is the minimum initial size that is necessary at the start of year 2? I: billion loonies Next, consider only the data for year 1. c. What peg should the United States set if it wants the xed exchange rate to increase the domestic money supply by $1.25 trillion? 1:: dollars per loonie l n"... I: n; 7

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