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Q. What do you mean by Capital Flows?
With free capital flows, this is a very unreasonable assumption. If we domestic interest rate increase against the foreign interest rates, capital will flow into our country that would drive down the domestic interest rate again.
Most reasonable models in that domestic interest rate is affected by foreign interest rates are more complicated. To understand such models, you should first understand models where this complication doesn't arise. Additionally predictions from models where domestic interest rate isn't affected by foreign interest rates are fairly similar to more realistic models which allows for capital flows.
Consider two consumers, A and B. A and B both want perfect consumption smoothing (c = cf) and both have no current wealth. However, the two consumers have different income streams.
Q. Show the example on IS-curve? Figure We can explain this argument with the above figure. 1. Start by identifying R 1 and R 2 in lower graph. 2. Draw aggr
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Define the term- inflation Inflation between two points in time is defined as the percentage increase of price index between these two points in time.
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From estimating the aforementioned unrestricted VAR, a table of coefficient and statistics will be produced. From this table, certain statistical information can be analysed, such
i have assignment due within less than 24 hours if i submit assignment can i get it back before 24 hours?
What is The law of comparative advantage The law of comparative advantage, though, suggests that it would be unwise of UK economy to try to replicate German model. First German
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