Dollar devaluation makes US products competitive abroad but does not maximize American consumers' welfare

Question

Quizplus · Accepted Answer

While devaluation of the dollar may make US products more attractive to foreign buyers due to their lower cost, it also means that imports become more expensive for American consumers. This can lead to higher prices and reduced purchasing power for US consumers, which ultimately does not maximize their welfare.

Dollar Devaluation Makes US Products Competitive Abroad but Does Not