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Use AA, DD, XX curves and the graph for the relative demands and supplies of foreign to home goods to analyze the effects of the

Use AA, DD, XX curves and the graph for the relative demands and supplies of foreign to home goods to analyze the effects of the following shocks on equilibrium values for the nominal exchange rate, the real exchange rate, output, the current account, and domestic and foreign prices in the short run and long run.

Investment falls temporarily.


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