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Explain how a floating exchange rate might alter the link between increased borrowing and the level of reserves, since a balance of payments deficit will have different implications for reserves under fixed and floating rates.

By EzekielPosted on February 28, 2023Posted in EconomicsTagged collegeessays, domestic credit, essayhelp, fiscal deficit, Polak model

ASSIGNMENT In this question you will need to show your grasp of the Polak model by analysing the effect of an increase in government borrowing. A good answer will explain the four identities in the model before discussing the behavioural assumptions to show the likely implications of an increase in government borrowing for domestic credit, […]