Consider the following statements: The effect of devaluation of a currency is that it necessarily 1. Improves the competitiveness of the domestic export in the

Question

Consider the following statements: The effect of devaluation of a currency is that it necessarily
1. Improves the competitiveness of the domestic export in the foreign markets
2. Increases the foreign value of domestic currency
3. Improves the trade balance
Which of the above statements is/are correct?

Accepted Answer

(A) 1 only

Answer

(B) 1 and 2

Answer

(C) 3 only

Answer

(D) 2 and 3