Explain apprication and depriciation of currency and its impact on export and import?
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To conclude, when a country has stronger value of currency or appreciation, they can import more goods and services from another country (assuming that the currency of exporting country remains the same.) than what they used to. And in the opposite way, if depreciation occurs in a country,no matter what the reason is, ...
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Since the exchange rate has an effect on the trade surplus or deficit, a weaker domestic currency stimulates exports and makes imports more expensive. Conversely, a strong domestic currency hampers exports and makes imports cheaper.
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