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Q. There is frequently a conflict between short-term and long-term interests in trade. Discuss. Answer: In trade models that the short term is usually defined as that (conce
Q. The two deadweight triangles are the Production distortion and Consumption distortion losses. It is simple to understand why the Consumption distortion constitutes a loss for
Q. How and why did Europe set up its single currency? Answer: The why part of the question is associated to large fluctuations in the exchange rates between the Europe
Q. Explain how an increase in the real exchange rate affects exports and imports. Answer: While the real exchange rate rises domestic products are cheaper relative to
Q. Explain how an increase in government spending would affect the DD-AA schedule in the short run. Answer: A raise in government spending will raise aggregate demand, which wi
Q. Explain why even owners of capital that cannot be moved can avoid more of the economic stability loss due to fixed exchange rates when Norway's economy is open to capital flows
what is the free trade
Q. Describe the chain of events leading to exchange rate determination for the following cases: 1. An increase in the U.S money supply 2. An increase in the growth rate of the
What are the International factor movements
what are the alternative theories of trade?
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