Economics · International Trade
What does devaluation of a currency mean?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1An increase in the domestic purchasing power of the currency
- 2A reduction in the value of the domestic currency relative to foreign currencies✓
- 3A decrease in the official gold reserves of the central bank
- 4An automatic market-driven decline in the exchange rate under a floating system
Correct answer
A reduction in the value of the domestic currency relative to foreign currencies
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