Post Utme Bsu 2021 Economics Question 11

Practice objective / multiple choice question 11 from the 2021 Post Utme Bsu Economics examination.

Post Utme Bsu 2021 Economics Objective / Multiple Choice
Question 11 POST_UTME_BSU • 2021 • ECONOMICS • objective

A country's balance of payments is in equilibrium when the value of its imports equals the value of its exports. However, if the country's imports exceed its exports, it will experience a trade deficit. What is the effect of a trade deficit on the country's exchange rate?

Answer Options

A. The exchange rate will appreciate.
Correct Answer B. The exchange rate will depreciate.
C. The exchange rate will remain unchanged.
D. The exchange rate will fluctuate.
Correct Answer
B
Correct Option:
The exchange rate will depreciate.

About This Question

This is Post Utme Bsu 2021 Economics Question 11. It is one of the objective questions from the 2021 Post Utme Bsu Economics examination.

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