Figure 32-7 Refer to This Diagram of the Open-Economy Macroeconomic Model of Model

question 76

Multiple Choice

Figure 32-7
Refer to this diagram of the open-economy macroeconomic model of the Mexican economy to answer the questions below.
-Refer to Figure 32-7.Suppose the Mexican economy starts at r2 and e2.Which of the following new equilibrium is consistent with capital flight?

• A)r2 and e3
• B)r3 and e2
• C)r3 and e1
• D)None of the above is correct.

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