Q. The main reason(s) why governments sometimes chose to devalue their currencies is (are):

  • (A) Devaluation allows the government to fight domestic unemployment despite the lack of effective monetary policy.
  • (B) Devaluation improves in the current account.
  • (C) Devaluation increases foreign reserves held by the central bank.
  • (D) All of the above.
βœ… Correct Answer: (D) All of the above.

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