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The figure below shows an IS-LM-FE model for country with a fixed exchange rate. Initially the country is at Point E, a triple intersection. Interest

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The figure below shows an IS-LM-FE model for country with a fixed exchange rate. Initially the country is at Point E, a triple intersection. Interest rate LMo FEo FE1 E IS1 1So Yo Domestic product Then, a shock hits the country and causes the shifts in the FE and IS curves. To defend the fixed exchange rate, the country's central bank must

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