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What is meant by depreciation of domestic currency ? |
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Answer» Currency depreciation implies that domestic currency has become less expensive in terms of foreign currency. If, in the initial situation, $1 = Rs.40 And in the final situation, $ 1 =Rs.50 then, Rupee is depreciating against the dollar. This is because now $ 1 can be used to purchase Rs.50 instead of Rs.40. Thus, rupee has become less expensive. |
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