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Which a increase in the exchange rate leads to

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Problem 1: X is domestic currency and Y is foreign currency. A increase in the exchange rate S(x/y) leads to:

a. an increase in the domestic current account

b. an indeterminate effect on the domestic current account, which will ultimately depend on the elasticities of the demand for imports and exports

c. a decrease in the domestic current account

d. no change in the domestic current account

Reference no: EM132976818

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