The chapter explained why exporters cheer when their home currency depreciates. At the same time, domestic consumers

Question:

The chapter explained why exporters cheer when their home currency depreciates. At the same time, domestic consumers find that they pay higher prices, so they should be disappointed when the currency becomes weaker. Why do the exporters usually win out, so that governments often seem to welcome depreciations while trying to avoid appreciations? (Hint: Think about the analogy with protective tariffs.)
Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

International Finance Theory and Policy

ISBN: 978-0133423648

10th edition

Authors: Paul R. Krugman, Maurice Obstfeld, Marc J. Melitz

Question Posted: