ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -When the value of a currency increases, it is said to have appreciated. On the other hand, when the value of a currency decreases, it is said to have depreciated.

Detailed explanation-2: -Currency appreciation is an increase in the value of one currency in relation to another currency. Currencies appreciate against each other for a variety of reasons, including government policy, interest rates, trade balances, and business cycles.

Detailed explanation-3: -Appreciation is when a currency experiences an increase in value when it is compared to other currencies. Depreciation is when a currency experiences a decrease in value when it is compared to other currencies.

Detailed explanation-4: -Numerous factors influence exchange rates, including a country’s economic performance, the outlook for inflation, interest rate differentials, capital flows and so on. A currency’s exchange rate is typically determined by the strength or weakness of the underlying economy.

Detailed explanation-5: -Exchange rate Various factors in the economy such as changes in supply, demand, and people’s tastes and preferences can cause the value of a currency to appreciate or depreciate in comparison to another.