Practice mode Macroeconomic Issues and Analysis

If a large car importer in Pakistan wants to bring in many cars, what will tend to happen to the exchange value of the Pakistani rupee?

Correct answer A. Depreciate

Explanation

To pay foreign car makers, the importer must sell rupees for foreign currency. That extra supply of rupees on the foreign exchange market lowers the rupee's value.

Report a problem

Answer checked 11 October 2026 How we write and check questions

Tip: press A, B, C or D to answer, and N for the next question.

If a large car importer in Pakistan wants to bring in many cars, what will tend to happen to the exchange value of the Pakistani rupee?

Discussion

Have a question about this answer? Cancel reply

If a large car importer in Pakistan wants to bring in many cars, what will tend to happen to the exchange value of the Pakistani rupee?

More Macroeconomic Issues and Analysis questions

At the peak of the business cycle, what is the likely position of aggregate demand, unemployment and inflation, and in which direction will the current account tend to move?

When the $/£ exchange rate rises, what happens to the pound, and what happens when it falls?

Starting from internal and external balance, what will a fall in aggregate demand do to the current account?

When capital mobility is perfect, what tends to offset differences in interest rates between countries?

Discussion

Have a question about this answer? Cancel reply