U.S. exporters may not necessarily benefit from weak-dollar periods if foreign competitors are willing to reduce their profit margins.

Question

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Even if the US dollar is weak, if foreign competitors are willing to lower their profit margins, they may be able to offer lower prices and still maintain their market share. This means that US exporters may not benefit from the weak dollar period as much as they would have if their foreign competitors did not lower their profit margins.

US Exporters May Not Necessarily Benefit from Weak-Dollar Periods If