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E4
How is the AD-BT-ERU curve affected by global recession ; regarding
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- What are the major issues with regard to trade imbalances for the U.S. economy?Suppose world interest rates go up, driving the world into a recession (that is, world income falls). Use the AD-AS model to analyze how this affects prices and income in our national economy. Do your results depend on whether exchange rates are fixed or flexible?Explain with illustrations or diagram, the effect of short-term movements in the business cycle on the trade balance? Describe the pattern of U.S economy with respect to its current account balance from the 1950s to the present.
- provide a specific statement of the current status of the US Economy - identifying the current status -how are is infaltion hurting our economyWhat happens to the balance of trade if the nominal exchange rate depreci-ates?assess how an increase in import prices and an increase in export prices will affect th sa economy.
- Find the import of goods when the balance of trade are 40 and the exports of goods are 20??Using the IS-LM-UIP diagram, show and explain the effect of the increase in taxes in the fixed exchange rate regime. Comment the efficiency of such shock.Select and drag answers to each step to describe the following process in the correct order: The process by which the current account may adjust when the government of a country, Tradavia, stimulates aggregate demand by increasing government spending, assuming the country has a floating exchange rate. Step 1 Step 2 Step 3 Step 4 The exchange rate falls Demand for exports falls Current account position may be unchanged Consumption, including consumption of imports, rises Demand for exports increases The exchange rate rises PHILIPS