The advantages of manufacturing goods in a particular country and exporting them to foreign markets
A)are weakened when that country's currency grows stronger relative to the currencies of the countries where the output is being sold.
B)are greatest when local consumers prefer products manufactured inside the country's borders.
C)are largely unaffected by fluctuating exchange rates.
D)can be wiped out when that country's currency grows weaker relative to the currencies of the countries where the output is being sold.
E)are largely unaffected by tariffs or quotas.

Question

Quizplus · Accepted Answer

When a country's currency grows stronger compared to the currencies of the countries where its goods are being sold, its products become more expensive for foreign buyers, weakening the competitive advantage of exporting those goods.

The Advantages of Manufacturing Goods in a Particular Country and Exporting