Question : When a country experiences a depreciation in its currency, it will likely have a positive impact on its:
Option 1: Imports
Option 2: Exports
Option 3: Current account balance
Option 4: Capital account balance
Answer (1)
17th Jan, 2024
Correct Answer: Exports
Solution :
The correct answer is (b) Exports.
depreciation in the currency makes the country's goods and services relatively cheaper for foreign buyers. This increased affordability can boost the competitiveness of the country's exports, potentially leading to an increase in export volumes and revenues.
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