In Using the Open-Economy Macroeconomic Model to Analyse an Event

question 18

Multiple Choice

In using the open-economy macroeconomic model to analyse an event, the first step is to:

• A)determine which of the supply and demand curves the event affects
• B)determine which way the curves shift
• C)use the supply-and-demand diagrams to examine how the shifts alter the economy's equilibrium
• D)it doesn't matter in which order the steps are taken