Practice Question 2: Consider the central bank balance sheet for the country of Riqueza. Riqueza current has 2,000 million escudos in its money supply, 1,200 million escudos of which backed by domestic government bonds; the rest is backed by foreign exchange reserve Assume that Riqueza maintains a fixed exchange rate of one escudo per dollar, th foreign interest rate remains unchanged, and money demand takes the usua form n

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