Consider a situation where Japanese yen has depreciated.This implies:
A)lower dollar profits to the U.S.firms from revenues earned in Japan.
B)higher dollar profits to the U.S.firms from revenues earned in Japan.
C)lower yen profits to the U.S.firms from revenues earned in the United States.
D)lower dollar profits to the Japanese firms from revenues earned in the United States.
E)same dollar profits to the Japanese firm from revenues earned in Japan.

Question

Quizplus · Accepted Answer

When the Japanese yen depreciates, it means that the value of the yen has decreased relative to the U.S. dollar. This, in turn, means that U.S. firms earning revenues in Japan will receive lower dollar profits as it will take more yen to equal one U.S. dollar.

Consider a Situation Where Japanese Yen Has Depreciated