When exchange rate of foreign currency falls, its demand rises. Explain how?

When exchange rate of foreign currency falls, its demand rises. Explain how?

Balance of Payment Economics Class 12 CBSE Value Based Questions

Baldeep Bajwa
Jul 24, 2020
1 Answers

Answers

Anju Dorbi

Jul 28, 2020

When exchange rate falls, imports become cheaper, demand for imports rises and so rises the demand of foreign exchange to purchase more imports.

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