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Solved: Devaluation of a currency is used to achieve which of the following a. an
Chapter 0, Problem 4(choose chapter or problem)
Devaluation of a currency is used to achieve which of the following? a. an elimination of a surplus in the foreign exchange market b. an elimination of a shortage in the foreign exchange market c. a reduction in aggregate demand d. a lower inflation rate e. a floating exchange rate
Questions & Answers
QUESTION:
Devaluation of a currency is used to achieve which of the following? a. an elimination of a surplus in the foreign exchange market b. an elimination of a shortage in the foreign exchange market c. a reduction in aggregate demand d. a lower inflation rate e. a floating exchange rate
ANSWER:Step 1 of 2
Devaluation of currency is associated with decreasing the currency's value while following the fixed exchange rate system by increasing the supply of domestic currency in the global market.