Currency depreciation is a reduction in the
A)amount of domestic goods foreign currency can purchase.
B)precious metal content in coins, such as the replacement of silver with copper in quarters.
C)goods and services a currency can purchase within its own country, usually the result of a period of inflation.
D)amount of foreign currency that can be obtained in trade for each unit of domestic currency.
E)amount of domestic currency that must be exchanged for a unit of foreign exchange.

Question

Quizplus · Accepted Answer

Currency depreciation is a reduction in the value of a currency in relation to other currencies on the foreign exchange market, which means that each unit of domestic currency can only buy a smaller amount of foreign currency than before. This can make imports more expensive and reduce the purchasing power of domestic consumers and businesses.

Currency Depreciation Is a Reduction in the