Question

If the U.S. dollar appreciates from 1.25 Swiss franc per U.S. dollar to 1.5 francs per dollar, then the franc depreciates from _______ U.S. dollars per franc to _______ U.S. dollars per franc. 0.50; 0.33 0.80; 0.67 0.67; 0.80 0.33; 0.50

Answer 1

The answer is below

Step-by-step explanation:

Appreciation and depreciation is caused by demand. If the value appreciates (or goes up), demand for the currency also rises. Whereas if a currency depreciates, it loses it value.

Given that the U.S. dollar appreciates from 1.25 Swiss franc per U.S. dollar to 1.5 francs per dollar. Sine the U.S dollar appreciates, hence the franc would depreciate. The franc depreciates from 1.25⁻¹ (0.8) U.S dollars per franc to 1.5⁻¹ (0.67) U.S dollars per franc.

If the U.S. dollar appreciates from 1.25 Swiss franc per U.S. dollar to 1.5 francs per dollar, then the franc depreciates from 0.80 U.S. dollars per franc to 0.67 U.S. dollars per franc.