Question: DRAW the figures to COMPARE the effects in the small open economy with perfect capital mobility and the large open economy. 1. expansionary fiscal policy;
DRAW the figures to COMPARE the effects in the small open economy with perfect capital mobility and the large open economy.
1. expansionary fiscal policy;
2. increase in domestic investment demand;
3. a fall in net capital outflow
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Perfect capital mobility theory states that the relative savings in an economy will lead to higher investment either domestically or internationally i... View full answer
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