Suppose the exchange rate value of the dollar depreciates. Who wins and who loses?
- Suppose the exchange rate value of the dollar depreciates. Who wins and who loses?
Homework Answers
When the dollar depreciates, the supply of dollar is more than the demand for dollar.
This will decrease the relative price of domestic goods and services and increase the relative price of foreign goods and services.
As a result, the exporters win and the importers lose as exports rise and imports fall.
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