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Start learning 50% faster. Sign in nowAs G increases, IS 1 shifts to IS 2 . At new equilibrium e', interest rate also increase and i > i*. Here,2 things are happening: a) there will now be capital inflow as a result capital A/c surplus b) Since, AD and Y increased, import demand will increase which will lead to current A/c deficit. Since, the magnitude of Capital A/c surplus will be much higher than the magnitude of current A/c deficit; there is BOP surplus. As a result domestic currency appreciates; dd for rupee has increased. As a result Exports decrease and Imports increase (imports have become cheaper) [Net exports falls] IS shifts back to initial level and equilibrium in the goods market is restored. In a small open economy with a floating exchange rate, the supply of real money balances is fixed and a rise in government spending raises the interest rate, so that income must rise to maintain equilibrium in the money market.
_____________ electrical static device is used to move the electric face signals or frequency from the primary circuit to the second circuit.
The Wadali Brothers are _________ singers.
Which of the following is the folk dance of Goa?
How much percentage of oxygen is present in the atmosphere?
In INSPIRE, “P” stands for ___________.
Which of the following crop is not grass?
Who designed India Gate, also called the All-India War Memorial?
What is ‘Jallikattu’?
The axis of the Earth is stated to be inclined at an angle of 66 ½°. With respect to which of the following does the axis of the Earth form this angle...