Question: Suppose that the U.S. is considering devaluing its dollar against a foreign currency to improve the trade balance. Use the absorption approach to explain how

Suppose that the U.S. is considering devaluing its dollar against a foreign currency to improve the trade balance. Use the absorption approach to explain how the U.S. can improve its trade balance from the currency devaluation, if the country is currently operating in the full-employment level of output.

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