A depreciation of the dollar relative to another currency will raise U.S.exports,lower U.S.imports,and raise U.S.net exports.

Question

Quizplus · Accepted Answer

When the dollar depreciates relative to another currency, it becomes cheaper for foreign buyers to purchase U.S. goods, making U.S. exports more attractive. At the same time, imports become more expensive for U.S. consumers, leading to a decrease in imports. These two factors combined lead to an increase in net exports, meaning that the value of exports exceeds the value of imports.

A Depreciation of the Dollar Relative to Another Currency Will