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RDP 8610: Equilibrium Exchange Rates and a Popular Model of International Asset Demands: An Inconsistency
Equation (2)
dw
(
t
)
=
w
(
t
)
[
{
μ
1
+
Σ
j
a
j
(
t
)
(
μ
j
−
μ
1
)
−
c
(
t
)
/
w
(
t
)
]
dt
+
w
(
t
)
[
σ
1
dz
1
+
Σ
j
a
j
(
t
)
(
σ
j
dz
j
−
σ
1
dz
1
)
]
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