Currency fluctuations question? (1 Viewer)

[chardie2]

Hypothetical:

I am a business who exports cars to America. Which will have a better impact on my business the American dollar depreciating or the American dollar appreciating?


Please help! I am really confused about which benefits the business more....

Thanks,
Charde.

 

[Gavvvvvin]

Depreciating Australian dollar = better for Australian exporters
Appreciating Australian dollar = better for Australian importers

 

[Iron]

Yeah. An Australian business would suffer if the American dollar fell, becasue the americans would have less money to import things o/s. If the american dollar rose, then they would have more money to buys things o/s.
So to answer your question, the australian business would benifit if the American dollar 'appreciated' (or similarly if the aussie dollar depreciated)