Consider the case of Turkey, an open macrocconomy with flexible exchange rates and in an initial equilibrium where the economy is producing at the full-capacity utilization (the natural) rate of output (Ys). The economy runs a trade deficit. Assume that the government has two alternative options to tight with the adverse effects of the global recession: an expansionar) monetary policy or an expansionary fiscal policy. Using the IS-LM-UIP frame, oik, for each of the policy options demonstrate the effects on Y, U, 14, E, C, 1, IM, X and NX. Would you recommend an expansionary monetary policy or an expansionary fiscal policy to the government according to the predictions of the IS-LM-UIP framework and the Marshall-Lerner condition
Consider the case of Turkey, an open macrocconomy with flexible exchange rates and in an initial equilibrium where the economy is producing at the full-capacity utilization (the natural) rate of output (Ys). The economy runs a
Assume that the government has two alternative options to tight with the adverse effects of the global recession: an expansionar)
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