Describe the theory of the exchange rate channel

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Describe the theory of the exchange-rate channel of the monetary transmission mechanism.

How, through the exchange rate, does an interest rate increase influence output? Why is this link difficult to find in practice?

Reference no: EM131223387

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Describe the theory of the exchange rate channel : Describe the theory of the exchange-rate channel of the monetary transmission mechanism. - How, through the exchange rate, does an interest rate increase influence output?
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