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Explain what happens to other, key macroeconomic variables (interest rates, investment (I), unemployment, real GDP, spot exchange rate for the dollar) when exchange rates are

  1. Explain what happens to other, key macroeconomic variables (interest rates, investment (I), unemployment, real GDP, spot exchange rate for the dollar) when exchange rates are flexible and domestic monetary policy seeks to increase the money supply (MS ), thus lowering domestic interest rates (idom ). Explain your answer.

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