Question

The open-economy macroeconomic model examines the determination of a. the output growth rate and the real interest rate.b. the trade balance and the exchange rate.c. unemployment and the exchange rate.d. the output growth rate and the inflation rate.

Answer 1

Answer:

B

Explanation:

The macroeconomic model is a tool for analysis formed to explain the operation of the problems of economy of a country or particular region.

An open-economy is one where the country or region trades with other countries or regions.

Hence, the open-economy macroeconomic model examines how the balance of trade of the country influences currency exchange rates via its influence on both demand and supply for foreign exchange.