When a country's currency undergoes a real appreciation:

Question

Quizplus · Accepted Answer

When a country's currency undergoes a real appreciation, the price of its goods increases relative to foreign goods, causing exports to become relatively more expensive and therefore less attractive to foreign buyers. At the same time, imports become relatively cheaper and more attractive to domestic consumers, leading to an increase in imports. Therefore, exports fall, and imports rise.

When a Country's Currency Undergoes a Real Appreciation