A country experiencing inflation higher than that of another country should see the value of its currency ________.

Question

Quizplus · Accepted Answer

When a country experiences higher inflation than another country, it typically means that the purchasing power of its currency is declining relative to the other country. This tends to result in a decrease in demand for the currency, which in turn causes its value to fall. Therefore, the correct answer is D - the currency should fall.

A Country Experiencing Inflation Higher Than That of Another Country