The Main Reason(s)why Governments Sometimes Chose to Devalue Their Currencies

question 79

Multiple Choice

The main reason(s) why governments sometimes chose to devalue their currencies is (are)

• A)devaluation makes domestic goods more expensive in relation to foreign goods.
• B)devaluation makes domestic services more expensive in relation to foreign services.
• C)devaluation increases foreign reserves held by the central bank.
• D)devaluation improves the current account and increases foreign reserves held by the central bank.
• E)devaluation hurts foreign currencies.