Question : When a country's currency appreciates, it means that:
Option 1: Its value increases relative to other currencies.
Option 2: Its value decreases relative to other currencies.
Option 3: Its value remains constant.
Option 4: None of the above.
Correct Answer: Its value increases relative to other currencies.
Solution : The correct answer is a) Its value increases relative to other currencies.
Currency appreciation refers to an increase in the value of a country's currency relative to other currencies. This means that it takes fewer units of the country's currency to purchase another currency. For example, if the exchange rate between the US dollar and the euro changes from 1 USD = 0.85 EUR to 1 USD = 0.90 EUR, it means that the US dollar has appreciated in value relative to the euro. In this case, it would take fewer US dollars to buy 1 euro.
Question : When a country's currency depreciates, it means that:
Option 1: Its value decreases relative to other currencies.
Option 2: Its value increases relative to other currencies.
Option 1: Its value decreases relative to other currencies
Option 2: Its value increases relative to other currencies
Option 3: It remains stable against other currencies
Option 4: It has no impact on other currencies
Question : When a country's currency is undervalued, it means that:
Option 1: Its value increases relative to other currencies
Option 2: Its value decreases relative to other currencies
Option 3: Its value remains the same as other currencies
Option 4: Its value cannot be determined accurately
Question : The currency of one country is said to appreciate when its value ________ in relation to another currency.
Option 1: increases
Option 2: decreases
Option 3: stabilizes
Option 4: remains constant
Question : As we go from the Equator to the North Pole value of 'g', the acceleration due to gravity
Option 1: remains same
Option 3: increases
Option 4: None of the above
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