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प्रश्न
What is 'appreciation' of domestic currency? What is its likely effect on exports and how?
उत्तर
Currency appreciation means the value of domestic currency becomes costlier in terms of foreign currency. For example, if the exchange rate for $1 = Rs 50 decreases to $1 = Rs 45, then the export of goods to foreign countries will become costlier. This implies that the rupee value is appreciated against the dollar. So, the goods worth Rs 48 for $1 only get exported, and hence, there is a decrease in the demand for exports.
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संबंधित प्रश्न
Foreign exchange transactions dependent on other foreign exchange transactions are called ______.
Explain the effect of appreciation of domestic currency on imports.
Give meaning of managed floating exchange rate.
Other things remaining the same, when the foreign currency becomes cheaper, the effect on national income is likely to be : (Choose the correct alternative)
a. Positive
b. Negative
c. Positive and negative both
d. No effect
How does giving incentives for the exports influence foreign exchange rate? Explain
Define foreign exchange rate.
When price of a foreign currency rises, its demand falls. Explain why.
When price of a foreign currency rises, its supply also rises. Explain why.
Would the central bank need to intervene in a managed floating system? Explain why.
Other things remaining unchanged, when in a country the price of foreign currency rises, national income is ______.
______ rate is the price of one currency in terms of another.
______ rate is the ratio of foreign prices to domestic prices.
______ is a scheme under which government can intervene to vary the exchange rate when the situation demands so.
Why is the demand curve for foreign exchange negatively sloped?
Suppose the exchange rate was \[\ce{$}\]1 = ₹ 80 and later changed to \[\ce{$}\]1 = ₹ 92. What will be its effect on the following?
Export of technical knowledge by the USA to India
Suppose the exchange rate was \[\ce{$}\]1 = ₹ 80 and later changed to \[\ce{$}\]1 = ₹ 92. What will be its effect on the following?
Import of wheat by India from the USA
State whether the following items will be included in the estimation of National Income or not: Give a reason for your answer.
Profit earned by State Bank of India in a foreign country.
