The exchange rate is the ruling official rate of exchange of dollars for other currencies . It determines the value of American goods in relation to foreign goods. If the the dollar is devalued in terms of other currencies , American exports ( which are
A. There are certain disadvantages for the United States economy attached to devaluation
B. The prospect of devaluation results in a speculative outflow of funds
C. By encouraging exports and discouraging imports, devaluation can improve the American balance of payments
D. The difference between the exports and imports is called the trade gap
E. It is possible that inflation neutralises the beneficial effects of devaluation
সঠিক উত্তরঃ
C.
By encouraging exports and discouraging imports, devaluation can improve the American balance of payments
Explanation:
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