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For an economy on a floating exchange rate regime with perfect capital mobility, use the AA-YY model to analyze and discuss the effects of a
For an economy on a floating exchange rate regime with perfect capital mobility, use the AA-YY model to analyze and discuss the effects of a transitory contractionary fiscal policy on the domestic interest rate, nominal exchange rate, output, and net exports. Be sure to explain your assertions, please do not only say that the interest rate increases/decreases, the nominal exchange rate depreciates/appreciates, etc
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