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In the Two-Period SOE Model, If the Real Interest Rate

Question 20

Multiple Choice

In the two-period SOE model, if the real interest rate decreases and the current account is initially in deficit, then


A) the current account deficit falls.
B) the current account surplus stays the same.
C) the current account deficit stays the same.
D) the current account surplus rises.
E) the current account surplus falls.

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