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Basic textbook models, such as the Mundell-Fleming model, say that capital inflow happens due to the domestic interest rate being higher than the world interest rate, and therefore capital inflow. So according to this model, it can lower interest rates so that interest rates stabilize to the world interest rate. Though, there is a checklist that requires to be ticked off and this checklist is like a chain, for example if domestic interest rates are high then there is going to be capital inflow, the domestic money will appreciate due to the enhance in demand for the currency, therefore Net Exports will decrease until exchange rates have stabilized.
the table shows gasoline rates in US
Drafting of Production Policy: Demand forecasts assists in drafting appropriate production policy so that there may not be any space between future demand and supply of a product.
Long-Term Policies One long term option of tackling balance of payments deficit is export promotion . In the long run this is the best method of improving a balance of payme
THEORY OF COMPARATIVE ADVANTAGE In his theory put forward in a book published in 1817, David Ricardo argued that what was needed for two countries to engage in international t
Advantages a. They are less costly to administer because the producers and sellers themselves deposit them with the government. b. If levied on goods with inelastic deman
Types of Public Debt Public debts can be classified according to the purpose for which the money was borrowed into; a. Reproductive Debt: where a loan has been
explain how income flows in governed economy
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The Budget line and its economic interpretation The indifference curve shows us consumer preferences but it does not show us the situation in the market place. Here the consu
Explain how a product would reach equilibrium position with the help of -iso-quants and iso-cost curve.
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