Everything else held constant,when a country's currency depreciates,its goods abroad become ________ expensive while foreign goods in that country become ________ expensive.

Question

Quizplus · Accepted Answer

When a country's currency depreciates, its goods become cheaper for foreigners to purchase, making them more attractive and increasing demand for them. At the same time, foreign goods become more expensive for domestic consumers, as each unit of foreign currency buys fewer units of the domestic currency. Therefore, Choice D, less expensive for domestic goods and more expensive for foreign goods, is the correct answer.

Everything Else Held Constant,when a Country's Currency Depreciates,its Goods Abroad