The exchange rate-does the dollar appreciate or depreciate

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Consider an open economy in which prices, interest rates and the exchange rates all vary. Explain briefly the effect expansionary fiscal policy would have on…

a) The exchange rate. Does the dollar appreciate or depreciate?

b) The trade balance. Improve or worsen?

c) The price level. Rise or fall?

d) The interest rate. Rise or fall?

Reference no: EM131194451

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