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Suppose that the US dollar and the Malaysian ringgit have a fixed exchange rate of $1/ RM4 and this exchange rate initially corresponds to equilibrium
Suppose that the US dollar and the Malaysian ringgit have a fixed exchange rate of $1/ RM4 and this exchange rate initially corresponds to equilibrium in the foreign exchange market. Draw and label a graph depicting the initial situation in the market for ringgit denominated deposits. What conditions must be fulfilled in order for this market to be in equilibrium? Explain
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