If There Is Capital Flight from Canada, How Does the Open-Economy

question 168

Multiple Choice

If there is capital flight from Canada, how does the open-economy macroeconomic model change?

• A) Both the supply of loanable funds and the supply of dollars for foreign exchange curves shift right.
• B) Both the supply of loanable funds and the supply of dollars for foreign exchange curves shift left.
• C) The supply of loanable funds shifts left, while the supply of dollars shifts right.
• D) The supply of loanable funds shifts right, while the supply of dollars shifts left.

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