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Assume a country has been running a significant expansionary fiscal policy for several years. Monetary policy has not been particularly expansionary. Determine what can you expect to happen to this nations's trade balance? What are the costs and benefits of this trade imbalance? If the country wished to correct for its trade imbalance, what fiscal and monetary policies would you suggest this country pursue now? [This question would be worth 15 marks]

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Macroeconomics, Economics

Category:- Macroeconomics
Reference No.:- M9308911

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