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Suppose the Indian government as part of its trade policy decides to remove tariffs or quotas. In an open economy context with perfect capital mobility,
Suppose the Indian government as part of its trade policy decides to remove tariffs or quotas. In an open economy context with perfect capital mobility, what will be the impact of this move on the exchange rate, net exports, and economic output of the country [Highlight your assumptions, if any and use graphs/diagrams for the explanation]?
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