If one country is experiencing prolonged lower inflation than another country,the currency of the first country should,in general,_______ with respect to the currency of the second country.

Question

Quizplus · Accepted Answer

When a country experiences lower inflation than another, its currency generally appreciates in value relative to the other country's currency. This is because lower inflation preserves the currency's purchasing power, making it more valuable compared to currencies from higher inflation countries.

If One Country Is Experiencing Prolonged Lower Inflation Than Another