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प्रश्न
Explain the impact of home currency depreciation on the exports of a nation.
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उत्तर
Impact of home currency depreciation on the exports of a nation:
Domestic currency depreciation refers to a decrease in the value of the domestic currency in relation to foreign currency as a result of market forces.
For e.g., 1 US dollar = ₹ 80 (before )
1 US dollar = ₹ 82 (after depreciation)
Because of the devaluation of the native currency, the purchasing power of the dollar has increased while the purchasing power of the rupee has dropped. Because Indian items are now cheaper in the US, one US dollar can now buy more goods and services. It will result in a rise in Indian exports.
संबंधित प्रश्न
Suppose it takes 1.25 yen to buy a rupee, and the price level in Japan is 3 and the price level in India is 1.2. Calculate the real exchange rate between India and Japan (the price of Japanese goods in terms of Indian goods).
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A system that allows adjustment in the fixed exchange rate is referred to as ______
______ system allows continuous and regular adjustments in the exchange rate.
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A fall in domestic currency value under a Fixed Exchange Rate System is called what?
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Which historical fixed exchange rate system was established in 1944?
Which institution supervised the Bretton Woods System?
