Discuss briefly household’s expected adjustments to (i) temporary shocks or (ii) permanent shocks resulting from changes...

Discuss briefly household’s expected adjustments to (i) temporary shocks or (ii) permanent shocks resulting from changes in household endowment, terms-of-trade and interest rate. Assume that households are in a small open economy with no uncertainty, no depreciation, free capital mobility and have log preferences.

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Rahul Sunny answered 1 year ago

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