What is meant by the marshall-lerner condition

Reference no: EM131900075

Problem

1. How does a currency depreciation affect a nation's balance of trade?

2. Three major approaches to analyzing the economic impact of currency depreciation are

(a) the elasticities approach, (b) the absorption approach, and

3. What is meant by the Marshall-Lerner condition? Do recent empirical studies suggest that world elasticity conditions are sufficiently high to permit successful depreciations?

Reference no: EM131900075

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