In a small open economy, if the world interest rate increases, then the supply of domestic currency

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In a small open economy, if the world interest rate increases, then the supply of domestic currency on the foreign exchange market will _____ and the real exchange rate will _____, holding all else constant.

A.decrease; increase

B.increase; decrease

C.increase; increase

D.decrease; decrease

Posted Date: Jun 22, 2024 08:00 PM

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In a small open economy, if the world interest rate increases, then the supply of domestic currency

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