Scenario: Just-for-Kids, Inc.
Just-for-Kids, Inc. is a toys and clothes manufacturer based in San Diego, California. The company has received an inquiry from an overseas company to do business. Tom Dodd is the owner of the company researching the opportunity and how exchange rates will affect its international business activities.
-How do you explain to Tom what devaluation in a target market means?

Question

Quizplus · Accepted Answer

Devaluation of a currency means that the currency's value has decreased relative to other currencies. This makes imports more expensive for the devalued currency, as more of the local currency is needed to purchase the same amount of foreign goods.

Scenario: Just-For-Kids, Inc. Just-For-Kids, Inc. Is a Toys and Clothes Manufacturer Based in Manufacturer