foreign country to be the leader country. a. How does a reduction in interest rates in the leader country affect the interest rate and output in the follower country? b. How does the reduction in leader country interest rates change the composition of output in the follower country? Assume the follower country does not change fiscal policy. component of output is changed? foreign country to be the leader country. a. How does a reduction in interest rates in the leader country affect the interest rate and output in the follower country? b. How does the reduction in leader country interest rates change the composition of output in the follower country? Assume the follower country does not change fiscal policy. component of output is changed