If the U.S.dollar depreciates in the foreign exchange market, American exports will be __________ and American imports will be __________.

Question

Quizplus · Accepted Answer

When the U.S. dollar depreciates, it means that it is worth less in the foreign exchange market. This means that American exports will become relatively less expensive for foreign consumers, making them more attractive and likely to increase. On the other hand, American imports will become relatively more expensive for American consumers, making them less attractive and likely to decrease. Therefore, American exports will be less expensive, and American imports will be more expensive.

If the USDollar Depreciates in the Foreign Exchange Market, American Exports Will