2019 Macro FRQ #3
If Econoland's Real Interest Rate is falling citizens take their currency into the FOREX buying foreign currency's to invest in the foreign investment assets to get higher Real rates of interest.
More Foreign Investment Assets
(c)(i)(1) & (2) Currency value will decrease
(c)(ii) Econoland's central bank will buy currency reducing the supply of Econoland's currency and driving the value back up.
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