The effects of devaluation includes all except
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Correct Answer: Option C
Explanation:
Devaluation generally makes imported goods more expensive and exports cheaper to foreign buyers. It can encourage local production by making imported alternatives more expensive. An increase in the standard of living is not normally an effect of devaluation because higher import prices can reduce consumers' purchasing power. The question is somewhat flawed because an increase in imports is also generally not an expected effect of devaluation.
Devaluation generally makes imported goods more expensive and exports cheaper to foreign buyers. It can encourage local production by making imported alternatives more expensive. An increase in the standard of living is not normally an effect of devaluation because higher import prices can reduce consumers' purchasing power. The question is somewhat flawed because an increase in imports is also generally not an expected effect of devaluation.