Explain what it meant by liquidity trap.use the interest, Ask an Expert

Economics

A) Explain Purchasing Power (PPP). What is the differences between Absolute PPP and Relative PPP? Why does PPP not hold in reality?

B)Explain what it meant by liquidity trap.Use the interest parity condition to show how the exchange rate is determined in such a situation. What can monetary policy so in such a situation?

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Macroeconomics, Economics

Category:- Macroeconomics
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