Business, 11.04.2020 04:46 babygirl123468

In the short run of a model with sticky prices, a reduction in the money supply raises the nominal interest rate and appreciates the currency. In this case the country's expected real interest rate will .
In addition, the real exchange rate, after initially ,
The latter movement of the real exchange rate satisfies the real interest parity condition which indicates that a country's currency will be expected to undergo a real V l subsequently depreciation when its real interest rate real interest rates elsewhere

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