LESSON 7


Big Open Economy Equilibrium


Topic 1: Two-Country Equilibrium: One Big Country and One Small Country

Topic 2: Effects of Stabilization Policy on the Home Economy

Topic 3: Small Country Response to Big Country Monetary Shocks

Topic 4: Small Country Response to Big Country Real Shocks

Topic 5: Equilibrium With Two Countries of Equal Size: Commodity Money Standards

Topic 6: Equilibrium With Two Countries of Equal Size: Key-Currency System

Topic 7: Equilibrium With Two Countries of Equal Size: Flexible Exchange Rate

General Readings

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PREPARED BY

John E. Floyd
Professor of Economics, University of Toronto
Toronto, Ontario, Canada

Copyright, John E. Floyd
j.floyd@utoronto.ca