LvL 2 Economics Exam Prep 91224 - Exchange Rates

Question	Answer
Definition of Exchange Rate (NZ$)	The Exchange Rate measures the value of the New Zealand Dollar (NZ$) in other currencies.
To convert overseas currency to (NZ$)...	Divide by the exchange rate
To convert a NZ price to another currency,	Multiply by the exchange rate
If the exchange rate appreciates, will NZ importers and travellers be better off?	Better off, lowers the amount of (NZ$) to buy the same amount of foreign currency, imports will be cheaper.
If the exchange rate depreciates, will importers and NZ travellers be better off?	Not better off, increases the amount of (NZ$) to buy the same amount of foreign currency, imports will be more expensive.
If the exchange rate appreciates, will NZ exporters and overseas travellers be better off?	Not better off, to overseas buyers, costs more foreign currency to buy the same amount of (NZ$) , exports for foreign buyers will be more expensive.
If the exchange rate depreciates, will exporters and overseas travellers be better off?	Better off, costs fewer units of foreign currency to buy the same amount of (NZ$), exports will be cheaper for overseas buyers.

Resource summary

	Created by Dani Young almost 3 years ago