WAEC Economics 2016 Objective — Question 47

Question 47 of 50 from the West African Examinations Council (WAEC) Economics 2016 Objective paper, with the correct answer and a full explanation.

47. When the international value of a country's currency rises, other things being equal, the country's (a) net exports tend to increase (b) imports tend to increase (c) net exports tend to decrease (d) exports tend to be stable

A. net exports tend to increase
B. imports tend to increase
C. net exports tend to decreaseCorrect
D. exports tend to be stable

Explanation

When the value of a country's currency rises (appreciates), exports become more expensive while imports become cheaper. This results in a decrease in net exports.

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