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The US imports good A from Europe and exports good B to Europe. The quantity of imports of good A is 400. The quantity of
The US imports good A from Europe and exports good B to Europe. The quantity of imports of good A is 400. The quantity of exports of good B is 200. Prices are set in the producer's currency (PCP): 10 Euros for good A and $20 for good B. The current exchange rate is $1/Euro. The import price elasticity is 2 and the export price elasticity is 1. Compute the US trade balance before and after a 10 percent appreciation of the dollar
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