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Recall the discussion of the Swiss franc's currency floor from Chapter 18, and also recall Chapter 17's discussion of the liquidity trap. Because Switzerland was
Recall the discussion of the Swiss franc's currency floor from Chapter 18, and also recall Chapter 17's discussion of the liquidity trap. Because Switzerland was in a liquidity trap all the time it defended its currency floor, does the liquidity trap theory have anything to say about why Swiss inflation has not been raised by the SNB's heavy foreign exchange purchases? Use a graph and discussion of the DD-AA model to support your
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