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When the Indian Rupee depreciates vis-à-vis the U.S. Dollar, it typically makes our:

  1. A
    Exports Cheaper and Imports Costlier
  2. B
    Imports Cheaper and Exports Costlier
  3. C
    Both Exports and Imports Costlier
  4. D
    No effect on Exports and Imports

Solution & Step-by-step Explanation

Currency depreciation means that the value of the domestic currency falls against a foreign currency. When the Indian Rupee drops in value relative to the U.S. Dollar, it requires more Rupees to purchase the same amount of foreign goods, making imports costlier. Conversely, foreign buyers can purchase more Indian goods for the same amount of Dollars, making Indian exports cheaper and more competitive in the international market.

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Try it yourself before checking the explanation above.

When the Indian Rupee depreciates vis-à-vis the U.S. Dollar, it typically makes our:
A
Exports Cheaper and Imports Costlier
B
Imports Cheaper and Exports Costlier
C
Both Exports and Imports Costlier
D
No effect on Exports and Imports

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