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Question 6 (Bonus of 10%) Lets consider the Overshooting Exchange-Rate Model of Dornbusch: p = -pte+0.6 e = 0.75e + 1.3 a) Analyze the stability

Question 6 (Bonus of 10%) Lets consider the Overshooting Exchange-Rate Model of Dornbusch: p = -pte+0.6 e = 0.75e + 1.3 a) Analyze the stability of the system using a phase diagram. b) Solve the system

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