Solved: 1 explain why the determination of the equilibrium exchange, Business Management

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1 explain why the determination of the equilibrium exchange

1) Explain why the determination of the equilibrium exchange rate in the foreign exchange market is a macroeconomic phenomenon.

2) Given (1) suppose the economy experiences an increase in government spending. How would you expect the response of the real exchange rate to this shock to depend on how integrated the domestic goods market is with the rest of the world?

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Business Management: 1 explain why the determination of the equilibrium exchange

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