Why is it important for an exporter to understand the distinction between a temporary change in the exchange rate and a permanent change in determining whether to respond to a real depreciation of the home currency with increased production or sales out of inventories

Question: Why is it important for an exporter to understand the distinction between a temporary change in the exchange rate and a permanent change in determining

Why is it important for an exporter to understand the distinction between a temporary change in the and a permanent change in determining whether to respond to a real depreciation of the home currency with increased production or sales out of inventories?

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