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ECON 330D1 (20)
Lecture 13

ECON 330D1 Lecture 13: Lecture 13
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Department
Economics (Arts)
Course
ECON 330D1
Professor
Jagdish Handa
Semester
Winter

Description
Cleo ing Condition 'Tf prices go up, Is Curve TRT IF or is co up, IS Curve To Derive the AD curve One (IRT Tn Chop er You hare both pus foreion exchange market C or equilibr om you need to c cor all 3 morke Foreign exchange clearing condition Bope CA KA o CA --KA (same ing as above Cleo ing Condition 'Tf prices go up, Is Curve TRT IF or is co up, IS Curve To Derive the AD curve One (IRT Tn Chop er You hare both pus foreion exchange market C or equilibr om you need to c cor all 3 morke Foreign exchange clearing condition Bope CA KA o CA --KA (same ing as aboveThe effect of the fore an exchange market or Class where rs interest rate exchange Tote PT,y, r ou con plot these points on the groph upy ord sloping example: F interest rate goes up, there be an inflow of copitci The exchonge note then appreciates. As in goes up, there is o capitol Ihllow an oui flori of Fund too tha. nust re To offset this, here our in CO in obile, Bop curve .s horizontal. our domesti equals the d TF cop Hal is mobile, Ba Curye is vertical ble exchange Taie r Fiscal exponaon Is sh to the right (IS IF 9 you in port more your net export decreases and the IS curve shifts back Fiscal expons on TS Shi to rght blc With 3 curves: Bop of th t you hove a Bop deficit tyour currency deprecia
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