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Predicted impact of this inflow of financial capital

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In the 2008 global financial crisis, many investors considered the U.S. economy a safe place to move their assets. What is the predicted impact of this inflow of financial capital to the United States, which is a large open economy, on the U.S. interest rate and the U.S. exchange rate, holding other factors constant. Illustrate your answer graphically and explain in words.

Reference no: EM132639709

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