can someone pls explain exchange rates to me and how they influence import and export price. cs I was looking at it and if aud compared to USD goes from $1=$1 to USD$1 = AUD$0.5 would that be appreciation or depreciation? u could buy more USD with the aud but then when I did a questions w this logic it was wrong lol. someone help
for your example, you should ensure both exchange rates are in the same format (eg AUD/USD or USD/AUD). If we convert it to USD/AUD (so we are comparing against one AUD) for both, that is $1.00USD/AUD to $0.5USD/AUD, which is a depreciation since instead of paying one AUD for one USD, you need to pay twice as much for the same amount of US dollars (eg $2AUD for one USD)
ok for exchange rates the currency can either appreciate or depreciate
if the currency appreciates it means it is more VALUABLE eg $0.65USD/AUD to $0.70USD/AUD, which means businesses can purchase more US dollars with the SAME amount of Australian dollars, which benefits australian businesses as they can pay less AUD
whereas for depreciation its the opposite - the AUD has become more weaker so to purchase the same amount of US dollars they need to spend MORE australian dollars, so US businesses are benefitted