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Consider the case of a gold standard economy with no capital mobility. In the absence of international capital mobility, is a current account (CA) deficit
Consider the case of a gold standard economy with no capital mobility. In the absence of international capital mobility, is a current account (CA) deficit sustainable? How would central bank reserves change if the country ran a CA deficit? What would be the effects on the money supply? How would output and employment change, and what would be the effects on the trade balance?
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