A reduction in the value of a currency that is determined under a floating exchange rate regime is a(n):

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In a floating exchange rate regime, the value of a currency is determined by market forces of supply and demand. When the demand for a currency decreases or supply increases, the value of the currency will fall, resulting in a depreciation of the currency. A devaluation, on the other hand, is a deliberate government action to reduce the value of the currency under a fixed exchange rate regime. Appreciation refers to an increase in the value of a currency, while revaluation is a deliberate government action to increase the value of the currency under a fixed exchange rate regime.

A Reduction in the Value of a Currency That Is