Author Question: In a flexible exchange rate regime, an increase in the expected future exchange rate will cause ... (Read 205 times)

corkyiscool3328 · **on:** Jun 30, 2018

In a flexible exchange rate regime, an increase in the expected future exchange rate will cause

A) the IP curve to shift to the left/up.
B) the IP curve to shift to the right/down.
C) a movement along the IP curve.
D) neither a shift nor movement along the IP curve.

Question 2

Suppose there are two countries that are identical with the following exception. The saving rate in country A is greater than the saving rate in country B. Given this information, we know that in the long run

A) output per capita will be greater in B than in A.
B) output per capita will be greater in A than in B.
C) economic growth will be higher in A than in B.
D) more information is needed to answer this question.