Asked by Bijeta Pradhan on May 28, 2024
Verified
If Currency R strengthens relative to Currency S, will the exchange rate in terms of units of S per unit of R increase or decrease? Explain.
Currency R Strengthens
The condition where Currency R increases in value relative to other currencies, leading to increased purchasing power internationally.
Exchange Rate
The value assigned to one currency when trading for another.
Units
A fundamental quantity used in mathematics and science to measure variables.
- Scrutinize how shifts in exchange rates affect the financial value of currencies.
Verified Answer
BR
bhavya rampalMay 30, 2024
Final Answer :
If currency R strengthens relative to currency S, then currency S weakens relative to currency R. It will require more of currency S to purchase 1 unit of R. Therefore, the exchange rate expressed as units of S per unit of R will increase.
Learning Objectives
- Scrutinize how shifts in exchange rates affect the financial value of currencies.