without accounting for any automatic stabilizers you can expect the aggregate

An increase in the U.S. demand for foreign exchange will cause a increase in the price of foreign exchange, which is a depreciation of the U.S. dollar, making foreign goods more expensive to U.S. residents Suppose the banking system has no excess reserves and required reserves equal to 20 percent of checkable deposits.

One reason that long time lags hamper the effectiveness of economic policy is that people don't want to wait for economic recovery They had not been recruited for their nautical skills. From the U.S. perspective, a drop in dollar price of foreign exchange means that the US exports to foreign countries will become cheaper

Pressure on existing capacity from higher forecast demand raises the desired size of each project, so investment rises to include the lighter coloured blocks.

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