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What happens to a nation's balance of trade when its currency depreciates?
Wiki User
∙ 11y ago
If a country begins to decrease it currency and at the same time it has trade deficit. Than, this depreciation will increase the export volume of that country. Because of the domestic goods of that country are now available at lower rate. But it also depends upon the exchange rate of other countries either it is same or also changed. For example in 1997-98Asian crises, reduce the exchange rate of many Asian counties that cause an increase the demand of their products. Like Thailand exports of fish increased.
Wiki User
∙ 16y ago
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Why does the demand curve slope downward in a foreign exchange market?
When foreign exchange rate decreases, the product of that particular country becomes cheaper as its currency depreciates. Therefore, the quantity demanded of that currency will increase as consumers from other nations wish to take advantage of the depreciating currency.
What is The value of a foreign nations currency in terms of the home nations currency?
Exchange Rate.
Is the exchange rate is the price of one nations currency in terms of another nations currency?
Yes, that is correct.
What are the two indicators nations rely on to measure global trade?
They are the balance of trade and the balance of payments.
Why might it be difficult for nations in this region to balance economic growth with concerns for the environment?
It might be difficult for nations in this region to balance economic growth with environmental concerns because of the environment in the region.
Why does the demand curve slope downward in a foreign exchange market?
When foreign exchange rate decreases, the product of that particular country becomes cheaper as its currency depreciates. Therefore, the quantity demanded of that currency will increase as consumers from other nations wish to take advantage of the depreciating currency.
How does the exchange rate of nations currency influence the balance of payments of an economy?
bhag madarchod
What is The value of a foreign nations currency in terms of the home nations currency?
Exchange Rate.
Is the exchange rate is the price of one nations currency in terms of another nations currency?
Yes, that is correct.
Is a nations money?
CURRENCY
What is the Asian national currency?
There is no Asian national currency. Asia is not a nation. It is a continent. It has many nations. Each of those nations have their own currencies.
How did Europeans nations maintain a balance of power?
European nations maintained a balance of power through wars and shifting alliances.
How do first nations benefit from treaties?
First Nations benefit from treaties by securing land rights, resource revenues, and access to healthcare and education. Treaties also help to preserve cultural traditions and provide avenues for self-governance. Additionally, treaties can establish partnerships and economic opportunities for First Nations communities.
Nations discouraged imports in what would be known as?
Nations discourage imports by tariffs or import duty which are special taxes on imports. If imports are actually fordidden it is called an embargo. Nations could also discourage imports by manipulating the currency exchange rate to make the local currency more valuable in relation to foreign currency.
What are the two indicators nations rely on to measure global trade?
They are the balance of trade and the balance of payments.
Why do nations need a system of currency exchange rate?
Nations need a system of currency exchange rate in order to be able to tell the value of their currencies. The exchange rate is set again the price of gold in order to have some uniformity across all nations.
Why did Estonia adopted the euro currency?
because they are part of the European Nations.
