Economics · International Economics
When defining the exchange rate as domestic currency per unit of foreign currency, a rise in the exchange rate means that:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Domestic trade balance automatically achieves equilibrium
- 2The price of foreign goods automatically becomes cheaper
- 3The relative value of the domestic currency is increasing or appreciating
- 4The relative value of the domestic currency is falling or depreciating✓
Correct answer
The relative value of the domestic currency is falling or depreciating
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