What happens to Indian exports when Indian rupee is devalued?

Exports become cheaper

The correct answer is Option (2) → Exports become cheaper

Out of the choices you provided, the most likely outcome when the Indian rupee is devalued is:

• Exports become cheaper

Devaluation makes Indian goods more attractive to foreign buyers because it reduces the cost for them to purchase those goods.

Here's why the other options are less likely:

• Export prices fluctuate: This is true, but devaluation is a specific factor that tends to push prices in a certain direction (cheaper).
• Export prices remain stable: This is unlikely in a devaluation scenario. The whole point is to make exports more competitive by lowering their effective price.
• Exports become dearer: Devaluation goes against this outcome. It's designed to make exports cheaper, not more expensive.