Illustrate why would you be reluctant to advise

Reference no: EM1329489

Important information about Appreciation/Depreciation

As an economist, you know that when a country depreciates its currency, initially its competitiveness in the world markets increases. You also know that currency appreciation improves the prospects of foreign investments which will likely increase GDP. The head of state has turned to you for your wise council. Why would you be reluctant to advise that your country increases its money supply?

Reference no: EM1329489

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