Show how the economy returns to equilibrium


Problem

Suppose growth in Europe rises, boosting US exports. That would reduce Sf, ceteris paribus. Explain what happens to the other components of I and S, and show how the economy returns to equilibrium.

The response should include a reference list. Double-space, using Times New Roman 12 pnt font, one-inch margins, and APA style of writing and citations.

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Macroeconomics: Show how the economy returns to equilibrium
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