If foreign demand for a country's goods increases, 1.the value of its currency will rise
2)the value of its currency will decline
3)the value of other currencies relative to its currency will be revalued
4)the value of other currencies relative to its currency will be devalued
A) 1 and 3
B) 1 and 4
C) 2 and 3
D) 2 and 4

Question

Quizplus · Accepted Answer

When foreign demand for a country's goods increases, the demand for that country's currency also increases, causing its value to rise. Consequently, the value of other currencies relative to it will be devalued.

If Foreign Demand for a Country's Goods Increases, 1