Holding demand constant, a decrease in supply for one currency relative to another will cause its value to depreciate relative to that currency.

Name: Holding demand constant, a decrease in supply for one currency relative to another will cause its value to depreciate relative to that currency.
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Question

Quizplus · Accepted Answer

A decrease in supply for one currency relative to another, holding demand constant, will cause its value to appreciate, not depreciate, relative to that currency.

Holding Demand Constant, a Decrease in Supply for One Currency