A depreciation of the real exchange rate in the basic model of a small open economy could be the result of:
A) a domestic tax cut.
B) an increase in government spending.
C) an increase in the world interest rate.
D) the expiration of an investment tax-credit provision.

Question

Quizplus · Accepted Answer

The Answer of A depreciation of the real exchange rate in the basic model of a small open economy could be the result of:
A) a domestic tax cut.
B) an increase in government spending.
C) an increase in the world interest rate.
D) the expiration of an investment tax-credit provision.

A Depreciation of the Real Exchange Rate in the Basic