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Chapter 21, Problem 1DAP
To determine

  • The net change in government international reserves for the most recent quarter of data available and for the same quarter five years’ prior.
  • The implications of the numbers about the net wealth of the United States relative to the net wealth of the rest of the world
  • The effect of the fact that the dollar is used as an international reserve currency on your interpretation

Concept introduction:

The ratio of change in average real interest rate and average inflation rate measures the responsiveness of real interest rate to changes in the inflation rate.

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