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Q3: Assume that Belgium, one of the European countries that uses the Krono as its currency, would prefer that its currency depreciate against the dollar.

Q3: Assume that Belgium, one of the European countries that uses the Krono as its currency, would prefer that its currency depreciate against the dollar. How can the central bank of Belgium use direct intervention to change the value of the currency? Please explain using diagrams (ie. Graphs). (5 marks) b) Assume that Italy, one of the European countries that uses the Lira as its currency, would prefer that its currency appreciate against the dollar.How can the central bank of Italy use direct intervention to change the value of the currency? Please explain using diagrams (ie. Graphs).

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