In a small open economy, when foreign governments reduce national saving in their countries, the equilibrium real exchange rate (measured in units of the home currency divided by units of foreign currency):
A)rises, and home country net exports fall.
B)rises, and home country net exports rise.
C)falls, and home country net exports fall.
D)falls, and home country net exports rise.

Question

Quizplus · Accepted Answer

The Answer of In a small open economy, when foreign governments reduce national saving in their countries, the equilibrium real exchange rate (measured in units of the home currency divided by units of foreign currency):
A)rises, and home country net exports fall.
B)rises, and home country net exports rise.
C)falls, and home country net exports fall.
D)falls, and home country net exports rise.

In a Small Open Economy, When Foreign Governments Reduce National