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Suppose that the federal government increases.

a. if the elasticity of national saving in relation to the world interest rate is very high, will this rise in the world interest rate have a larger or small effect on Canada's net capital outflow?

b. if the elasticity of Canada's exports in relation to the real exchange rate is very low, will this rise in the world interest rate have a large or small effect on Canada's real exchange rate?

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M938953

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