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The recessionary gap in a country is $1 trillion. The spending multiplier is 5. For every $50 billion borrowed, interest rates increase by 0.1 %. For every 0.1% increase in interes
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Q. "Given that labor remains relatively immobile within Europe, the European Union's success in liberalizing its capital flows may have worked perversely to worsen the economic sta
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Q. What are the main points of economic life that macroeconomics analysis is most concerned with? Answer: There are four major aspects that are saving, unemployment, trade imb
Q. Describe alternative forms of capital inflow to finance external deficits and explain why these methods were used in different times? Answer: The capital inflows to facili
Q. Describe the effects of the Smoot-Hawley tariff imposed by the United States in 1930. Answer: It had a damaging consequence on employment abroad. The foreign response occu
Q. Present the case for floating exchange rates. Answer: 1. Monetary policy autonomy Governments would able to use financial policy to reach internal and extern
Q. What are the reasons for the world as a whole running a substantial current account deficit? Answer: This deficit improved sharply in the early 1980s and has remained high.
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