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2.2.5 Net trade (X-M)

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Question 7

An island economy is a major net exporter of tourism services. Draw an AD/AS diagram to show the effect of a substantial depreciation in the value of the island's domestic currency on the equilibrium price level and real national output of this economy.

AD/AS Diagram showing rightward shift of AD due to currency depreciation

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2.2.5 Net trade (X-M) Questions

  1. A Level
  2. /Economics
  3. /2.2.5 Net trade (X-M)