Practicing Success

Target Exam

CUET

Subject

Economics

Chapter

Indian Economic Development: Liberalisation, Privatisation and Globalisation - An Appraisal

Question:

 

Which of the following refers to decrease in the value domestic currency by the government?

Options:

Depreciation

Devaluation

Amortisation

Obsolescence

Correct Answer:

Devaluation

Explanation:

Devaluation refers to decrease in the value of the domestic currency by the government consciously. A devaluation occurs when a country makes a conscious decision to lower its exchange rate in a fixed or semi-fixed exchange rate whereas, a depreciation is when there is a fall in the value of a currency in a floating exchange rate.