Question

Depreciation of Indian rupee vis-a-vis American dollar will lead to:

Options

• fall in the value of rupee relative to dollar

• increases the domestic price of imports

• the quantity of India's import decreases

• all of these

Answer 1

All of these

Explanation:

Depreciation lowers the rupee's value, raises the domestic price of imports, and reduces the quantity of imports demanded. Hence, statements 1to 3 are all consequences of depreciation.