If a country devalues its currency, there would be
-
reduction in imports
- reduction in exports
- increase in production locally
- increase in local standard living
The correct answer is: A
Explanation
Devaluation of a country's currency reduces the cost of exporting goods and services to other countries, making the exporting country to be more competitive in the global market, which, in turn, increases the cost of importing goods into the country.
With a high cost of importation, imports will be reduced as people will be uninterested in importing goods at a high cost.