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Help me with the following questions: Hint: don't forget to add figures and graphs. fIn our discussion of short-run exchange rate oversimoting, we assumed that

Help me with the following questions:

Hint: don't forget to add figures and graphs.

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\fIn our discussion of short-run exchange rate oversimoting, we assumed that real output was given. Assume instead that an increase in the money supply raise: real output in the short run [an assumption that will hejustied in Chapter 1?]. Hw does this alfect the extent to which the exchange rate oyersInots when the money supply rst increasel'? Is it likely that the exchange rate unlershoots'? (Hint: In Figure lS-lia, allow the aggre- gate real money demand schedule to shift in response to the increase in output.)

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