The likely implication of the devaluation of a country's currency is that
Answer Details
When a country devalues its currency, it means that the value of its currency has decreased relative to other currencies. This can have several implications, including:
1. Exports become cheaper: Since the value of the currency has decreased, the price of the country's goods and services becomes relatively cheaper for foreign buyers. This can make the country's exports more competitive in the global market, which could lead to an increase in the demand for its goods and services.
2. Importation of goods becomes more expensive: When a country's currency is devalued, it becomes more expensive for the country to import goods and services from other countries. This is because the value of the country's currency has decreased, so it can buy less foreign currency with the same amount of its own currency. As a result, the cost of imported goods and services becomes relatively higher.
3. The value of the country's currency falls: When a country's currency is devalued, it means that its value has decreased compared to other currencies. This can make the country's currency less attractive to foreign investors, which could lead to a decrease in the demand for its currency.
4. Foreign goods become more attractive: When a country's currency is devalued, it becomes relatively cheaper for foreigners to buy goods and services in that country. This can make the country's economy more attractive to foreign tourists, which could lead to an increase in tourism revenue.