Question

1.) A rise in the value of a currency in relation to another currency in the...

1.) A rise in the value of a currency in relation to another currency in the international market is called:
a. Appreciation
b. Depreciation.
c. Devaluation.
d. Conservation.
e. Redenomination.

2.) Deficit in a country's current account means that:
a. The country is running a net deficit in its financial account.
b. The country is a net lender to the rest of the world.
c. The country is running a net surplus in its financial account.
d. The country will have a positive value of net exports.
e. The domestic production us in excess of domestic spending.
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Answer #1

1) when the value of the currency rises in relation to another currency in the international market, then it is called appreciation of the Currency. For example if the value of of US Dollar rises in relation to Canadian Dollar then it is appreciation of US dollar.

Therefore, Option a is correct.

2) in order for the overall balance of payment to balance it is necessary that the deficit in a country's current account must be matched with a net surplus in its financial account.

Therefore, deficit in a country's current account means that the country is running a net surplus in its financial account.

Hence, Option c is correct

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