Question

Suppose that Americans decide to increase their saving. As a result, the real interest rate will , and U.S. net capital outflow will . If the elasticity of U.S. net capital outflow with respect to the real interest rate is very low, this increase in private saving will have a effect on U.S. domestic investment. If the elasticity of U.S. exports with respect to the real exchange rate is very high, this increase in private saving will have a effect on the U.S. real exchange rate.

Answer 1

Answer

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Step-by-step explanation:

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