A $2 million investment in Thailand loses value by $500,000 when the Thai government depreciates its currency-the Baht

Question

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When a government depreciates its currency, the value of investments in that currency from a foreign perspective decreases. Therefore, if the Thai government depreciates the Baht, a $2 million investment by a foreign entity would lose value, in this case, $500,000, due to the reduced value of the Baht against the investor's home currency.

A $2 Million Investment in Thailand Loses Value by $500,000