According to the J-curve effect,currency depreciation:
A) Decreases a trade deficit
B) Increases a trade deficit
C) Decreases a trade deficit before increasing a trade deficit
D) Increases a trade deficit before decreasing a trade deficit

Question

Quizplus · Accepted Answer

The J-curve effect suggests that after a currency depreciation, a country's trade deficit may initially worsen before improving as prices adjust and export volumes increase.

According to the J-Curve Effect,currency Depreciation