Over time,a depreciation in the value of a nation's currency in the foreign exchange market will result in:
A) Exports rising and imports falling
B) Imports rising and exports falling
C) Both imports and exports rising
D) Both imports and exports falling

Question

Quizplus · Accepted Answer

A depreciation in a nation's currency makes its goods cheaper for foreign buyers, leading to an increase in exports. Conversely, foreign goods become more expensive for domestic consumers, leading to a decrease in imports.

Over Time,a Depreciation in the Value of a Nation's Currency