If more home goods are required to buy the same amount of foreign goods, then we say that foreign currency has experienced a:
A) nominal appreciation.
B) nominal depreciation.
C) real appreciation.
D) real depreciation.

Question

Quizplus · Accepted Answer

Real depreciation occurs when the domestic currency loses value relative to foreign currencies, making foreign goods more expensive in terms of domestic currency.

If More Home Goods Are Required to Buy the Same