Which of the following will cause the Australian dollar to depreciate against the Japanese yen?
A)Prices in Japan rise faster than prices in Australia.
B)The average productivity of Japanese firms is higher than Australian firms.
C)Australian consumers decrease their preferences for Japanese goods.
D)A quota is placed on Australian products.

Question

Quizplus · Accepted Answer

If the average productivity of Japanese firms is higher than Australian firms, it can lead to increased competitiveness of Japanese goods, potentially increasing demand for the yen and decreasing demand for the Australian dollar, causing it to depreciate against the yen.

Which of the Following Will Cause the Australian Dollar to Depreciate