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Countries X and Y are neighboring countries in the Americas that are dissimilar in every respect. They are each others major trading partner and country
Countries X and Y are neighboring countries in the Americas that are dissimilar in every respect. They are each others major trading partner and country X pegs its currency to the other countrys currency. If country Y suddenly experiences a rise in inflation, what will happen to country Ys trade balance, nominal exchange rate, real exchange rate and inflation rate?
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