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प्रश्न
Giving valid reason, state whether the following statement is true or false:
Depreciation of the Indian Currency will lead to promotion of Indian exports.
पर्याय
True
False
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उत्तर
This statement is True.
Reason:
The purchasing power of foreign currency increases when the Indian currency depreciates. For foreign countries, domestically manufactured items become less expensive. It results in an increase in Indian exports.
संबंधित प्रश्न
Suppose the exchange rate between the Rupee and the dollar was Rs. 30=1$ in the year 2010. Suppose the prices have doubled in India over 20 years while they have remained fixed in USA. What, according to the purchasing power parity theory will be the exchange rate between dollar and rupee in the year 2030.
______ occurs when the currency exchange rate is officially lowered under a fixed exchange rate system.
If inflation is higher in country A than in Country B, and the exchange rate between the two countries is fixed, what is likely to happen to the trade balance between the two countries?
______ system allows continuous and regular adjustments in the exchange rate.
Point out a demerit of the fixed exchange rate.
Identify the correctly matched pair from Column A to that of Column B:
| Column A | Column B |
| (1) Private Consumption Expenditure | (a) Market Rate of Interest |
| (2) Private Investment Expenditure | (b) Total Expenditure |
| (3) Autonomous Investment | (c) Construction of Roads |
| (4) Aggregate Demand | (d) Level of personal disposable income |
Point out the merit of the flexible exchange rate.
Which are the two main systems of exchange rate determination?
Under the Fixed Exchange Rate System, the exchange rate is determined by whom?
A rise in domestic currency value under a Flexible Exchange Rate System is called what?
If demand for foreign currency increases, what happens to the exchange rate?
Which factor states that expectation of appreciation of a foreign currency increases its demand?
Which formula represents Interest Rate Differential?
In the long run, what does Purchasing Power Parity (PPP) state about exchange rates?
Which formula represents Exchange Rate (PPP)?
What is Devaluation under a Fixed Exchange Rate System?
What is Revaluation under a Fixed Exchange Rate System?
Which historical fixed exchange rate system was established in 1944?
Which institution supervised the Bretton Woods System?
