Consider the scenario in Figure 17 4 a rise in confidence causes a fall in net capital outflows, and the central bank adjusts the interest rate to keep the exchange rate constant For this case, explain what happens to each of the components of aggregate spending consumption, investment, government ...

For this scenario the four components of aggregate spending C I G and NX are simultaneously impacted ...

Consider the scenario in Figure 17.4: a rise in confidence causes a fall in net capital outflows,

Question:

Consider the scenario in Figure 17.4: a rise in confidence causes a fall in net capital outflows, and the central bank adjusts the interest rate to keep the constant. For this case, explain what happens to each of the components of aggregate spending: consumption, investment, government purchases, and net exports.
Exchange Rate
The value of one currency for the purpose of conversion to another. Exchange Rate means on any day, for purposes of determining the Dollar Equivalent of any currency other than Dollars, the rate at which such currency may be exchanged into Dollars...