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Initially, the economy's output is lower than the full-employment level of output and its trade is in surplus. If it wants to achieve higher output
Initially, the economy's output is lower than the full-employment level of output and its trade is in surplus. If it wants to achieve higher output and zero trade balance, what fiscal policy and exchange policy does the government use? Show your answer graphically with brief explanations. Draw your graph on scratch papers provided in class
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