LESSON 4


Small Open Economy Equilibrium II:

Monetary Policy Under Flexible Exchange Rates


Topic 1: Commodity Market Equilibrium

A Copy of the Figure Presenting Actual and Desired Output

Topic 2: Asset Market Equilibrium

Topic 3: The IS and LM Curves

Topic 4: Monetary Shocks Under Flexible Exchange Rates: Less Than Full Employment

Copy of the Figure Presenting Monetary Shocks in a Small Open Economy: Less Than Full Employment

Topic 5: Monetary Shocks Under Flexible Exchange Rates: Full Employment

Copy of the Figure Presenting Monetary Shocks in a Small Open Economy: Full Employment

Topic 6: Some Conclusions Regarding Monetary Policy in a Small Open Economy

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