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Suppose the United Kingdom can be modelled as a small open economy. With the aid of diagrams of the Market for Loanable Funds and the
Suppose the United Kingdom can be modelled as a small open economy. With the aid of diagrams of the Market for Loanable Funds and the Market for Foreign Currency Exchange, describe what would happen to the net capital outflow, the real exchange rate and net exports if there is an increase in the perceived risk of holding British assets after exit from the European Union.
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