In August 1994, Alan Blinder, recently appointed as vice chairman of the Federal Reserve Board, gave a

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In August 1994, Alan Blinder, recently appointed as vice chairman of the Federal Reserve Board, gave a talk in which he argued that the Fed should be willing to tolerate somewhat higher inflation to spur economic growth and job creation. The dollar fell almost immediately. Explain the link between Dr. Blinder's views and the value of the dollar.

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