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Suppose the demand for dollars (in exchange for euro) is given by the equation: D = 160 + 0.030 YFor -550 For + 700r -

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Suppose the demand for dollars (in exchange for euro) is given by the equation: D = 160 + 0.030 YFor -550 For + 700r - 28 8nom The supply of dollars is given by: S =120 + 0.022 Y + 300 For -600r + 20 enom Suppose output and the real interest rate in the domestic country and the foreign country are: Y = 8,500, YFor = 10,000, r = 0.060,For = 0.060. Calculate the equilibrium value of the nominal exchange rate. (In your calculations, carry out your intermediate steps to three decimals and round your answer to three decimals). Bhom

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