Question : The domestic country will have to spend more domestic currency to import foreign goods. Which effect of depreciation is highlighted here?
Option 1: Increase in exports
Option 2: Decrease in imports
Option 3: Increase in the national income
Option 4: All of the above.
Answer (1)
26th Jan, 2024
Correct Answer:
Decrease in imports
Solution :
Depreciation of a domestic currency means a fall in the price of domestic currency in terms of foreign currency, where more amount of money has to be spend to import goods.
Hence Option B is correct.
Comments (0)
