4
QuizMultiple Choice

International Economics — Test

Question 4 • Personal Finance and Economics

Why might a country choose to devalue its currency?

Answer
A
to reduce taxes
B
to encourage exports
C
to please its trading partners
D
to encourage imports

Explanation

Devaluing a currency makes the country’s goods and services less expensive for buyers using other currencies. This can make exports more attractive and increase demand for them. It tends to make imports more expensive, so encouraging imports is not the main reason.

AI-written and checked against the verified answer.

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