Describe the types of foreign investments, their forms, objectives, timing and purpose.
List the factors that complicate the conduct of economic policy.
The equation of the LM curve in a small open economy with a floating exchange rate E is of the form Y = 200r - 300 + 2 (M / P), the equation of the IS curve has the form Y = 300 + 2G - 2T + 4NX - 100r. The function is given by net exports NX = 200 - 100E. The price level is P = 1. The level of the world interest rate r - 2,5%. Money supply M = 250. Public expenditure G = 200. Net taxes T = 150. The real exchange rate E = 1,0.
The equilibrium of GDP if the financial sector of the economy affected by the global interest rate.
Determine in this case need to change government spending, net taxes, net exports, the exchange rate, if the government wants to maintain the equilibrium of GNP. Calculate how to be a new level of money supply, ensuring the maintenance of a fixed exchange rate, if government spending increased to 250.