When a country's currency is devalued, this ____ the cost of foreign goods and ____ the cost of domestic goods to foreign firms.
A) increases; decreases
B) reduces; reduces
C) decreases; increases
D) neutralises; raises
E) neutralises; decreases

Question

Quizplus · Accepted Answer

Devaluation makes foreign goods more expensive for domestic consumers and makes domestic goods cheaper for foreign buyers.

When a Country's Currency Is Devalued, This ____ the Cost