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Impact of Currency Appreciation
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When a country's currency appreciates, it is always beneficial for its export industry because it increases the overall demand for its goods abroad.

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Answer

When a country's currency appreciates, it means that its money is worth more compared to other currencies. This can actually make things harder for the export industry because the products from that country become more expensive for foreign buyers. For example, if a shirt costs $20 in the U. S. and the dollar gets stronger, it might now cost 25 euros for someone in Europe to buy that shirt.

Detailed Explanation

When a currency appreciates, it means it becomes more expensive compared to other currencies. Other options are incorrect because Many people think that a stronger currency always helps exports.

Key Concepts

Currency Appreciation
Impact on Exports
Balance of Payments
Topic

Impact of Currency Appreciation

Difficulty

medium level question

Cognitive Level

understand

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