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If German Demand for Australian Exports Increases at the Same

Question 67

Multiple Choice

If German demand for Australian exports increases at the same time as Australian productivity increases,relative to German productivity,in the long run:


A) the euro should appreciate, relative to the AUD dollar.
B) the AUD dollar should depreciate, relative to the euro.
C) the AUD dollar should appreciate, relative to the euro.
D) it is uncertain whether the euro would appreciate or depreciate, relative to the AUD dollar.

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