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Consider the countries of Cyprus and Lithuania, both of which are part of the European Union and use the euro as their domestic currency. In
Consider the countries of Cyprus and Lithuania, both of which are part of the European Union and use the euro as their domestic currency. In 2017, Cyprus had an inflation rate of 0.68%, and Lithuania had an inflation rate of 3.72%. Suppose at the end of 2017, the European Central Bank (ECB) implements a monetary policy designed to stimulate economic growth and reduce unemployment across the Eurozone. Given the inflation rates of Cyprus and Lithuania in 2017, Cyprus would benefit from this monetary policy than Lithuania. As a result, should consider using fiscal policy to solve its local economic problems
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