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Author Question: Why does the depreciation of a country's currency tend to increase its price level? (Read 88 times)

bclement10

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on: Apr 19, 2019

Question 1

The J-curve effect suggests that the depreciation of a nation's currency may


◦ increase its exports and decrease its imports.
◦ increase its imports and decrease its exports.
◦ have an ambiguous effect on its balance of trade.
◦ lead to economic ruin.

Question 2

Why does the depreciation of a country's currency tend to increase its price level?


◦ domestic buyers tend to substitute imports for domestic products
◦ a currency depreciation makes a country's products less competitive in world markets, so exports fall
◦ a currency depreciation makes imported inputs more expensive
◦ a currency depreciation makes imported inputs less expensive
Principles of Economics ¦ Case, Fair, Oster ¦ 12th Edition
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Marked as best answer by bclement10 on Apr 19, 2019

raili21

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Reply #1 on: Apr 19, 2019
Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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bclement10

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Reply #2 on: Apr 19, 2019
Excellent


raili21

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Reply #3 on: Apr 19, 2019
Great! Please up vote :D


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