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Consider the goods market for a small open economy, where e is the real exchange rate, X are exports, IM are imports and Y* is

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Consider the goods market for a small open economy, where e is the real exchange rate, X are exports, IM are imports and Y* is foreign income. C = 260 + 0.6YD X = 0.05Y* - 114e 1 = 0.1Y - 891 1 IM = 0.3Y + 838 G = 942 Y*=3621 i = 0.01 (1%) e = 1 T = 1051 Claculate the level of equilibrium output and the trade balance in this economy: O A. Y =934.08; NX = - 284.97 O B. Y = 911.08; NX = -289.27 O C. Y = 892.21; NX = -281.4 O D. Y = 952.38; NX = - 295.57

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