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Which of the following is true for countries following the gold standard exchange rate system?
1. The value of the exchange rate is relatively stable.
2. These countries are not prone to deflation or inflation.
3. Discretionary fiscal policy in these countries is hindered.
4. These countries are relatively less susceptible to domestic shocks.
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Independence Burgers serves fast food at its 300 franchised across the South.
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Plot the data on a scattergram with the S&P index on the vertical axis and CPI on the horizontal axis.What can you say about the relationship between the two indexes? What does economic theory have to say about this relationship?
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