Explain the difference between appreciation and depreciation of a nation's currency. How do these changes affect the foreign exchange market?© BrainMass Inc. brainmass.com October 10, 2019, 2:44 am ad1c9bdddf
Appreciation of a nation's currency happens when there is an increase in the value that specific currency holds. If the American dollar appreciates relative to a euro (or some other foreign currency), the exchange rate declines. It takes less American dollars to purchase the same amount of that country's foreign ...
This solution explains the difference between appreciation and depreciation of a nation's currency.