Depreciation (Currency)
Decrease in currency value relative to another.
Formula
Impact on Export Price = Original Price × New Exchange Rate
Real World
After the pound depreciated following the 2016 Brexit referendum, Rolls-Royce's dollar-denominated export revenues converted back into more pounds, temporarily boosting its reported profits.
Exam Focus
State explicitly: depreciation helps exporters but hurts importers — applying both sides in evaluation questions secures the top mark band.
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