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Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:
Assertion (A): When in order to buy 1 US dollar ₹ 80 are needed instead of ₹ 75, domestic currency shows depreciation.
Reason (R) : Depreciation of domestic currency refers to fall in the value of domestic currency in terms of foreign currency caused by rise in foreign exchange rate in the foreign exchange market.
  • a)
    Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).
  • b)
    Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).
  • c)
    Assertion (A) is true but reason (R) is false.
  • d)
    Assertion (A) is false but reason (R) is true.
Correct answer is option 'A'. Can you explain this answer?
Verified Answer
Directions: In the following questions, a statement of assertion (A) ...
Here, domestic currency shows depreciation because more rupees are to be paid to buy one US dollar.
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Directions: In the following questions, a statement of assertion (A) ...
Assertion (A): When in order to buy 1 US dollar ₹ 80 are needed instead of ₹ 75, domestic currency shows depreciation.

Reason (R): Depreciation of domestic currency refers to fall in the value of domestic currency in terms of foreign currency caused by rise in foreign exchange rate in the foreign exchange market.

Explanation:

Understanding Assertion (A):
The assertion states that when it takes more Indian Rupees (₹) to buy 1 US dollar ($), the domestic currency (Indian Rupee) shows depreciation. In simple terms, when the value of the domestic currency decreases in relation to a foreign currency (in this case, the US dollar), it is considered depreciation.

Understanding Reason (R):
The reason given for the assertion is that depreciation of domestic currency refers to a fall in the value of domestic currency in terms of foreign currency caused by a rise in the foreign exchange rate in the foreign exchange market.

Explanation:
The given assertion and reason are both true, and the reason correctly explains the assertion.

Explanation of Assertion (A):
When the exchange rate between two currencies changes, it affects the value of each currency in relation to the other. In this case, when it takes more Indian Rupees (₹) to buy 1 US dollar ($), it means that the value of the Indian Rupee has decreased in relation to the US dollar. This decrease in value is considered depreciation.

Explanation of Reason (R):
Depreciation of domestic currency refers to a fall in the value of the domestic currency in terms of foreign currency. In the given scenario, the rise in the foreign exchange rate (from ₹75 to ₹80 per US dollar) indicates that it now takes more Indian Rupees to buy 1 US dollar. This increase in the exchange rate leads to a fall in the value of the Indian Rupee, which is depreciation.

Conclusion:
Both the assertion and the reason are true, and the reason correctly explains the assertion. Hence, the correct answer is option 'A': Both assertion (A) and reason (R) are true, and reason (R) is the correct explanation of assertion (A).
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Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): When in order to buy 1 US dollar ₹ 80 are needed instead of ₹ 75, domestic currency shows depreciation.Reason (R) : Depreciation of domestic currency refers to fall in the value of domestic currency in terms of foreign currency caused by rise in foreign exchange rate in the foreign exchange market.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'A'. Can you explain this answer?
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Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): When in order to buy 1 US dollar ₹ 80 are needed instead of ₹ 75, domestic currency shows depreciation.Reason (R) : Depreciation of domestic currency refers to fall in the value of domestic currency in terms of foreign currency caused by rise in foreign exchange rate in the foreign exchange market.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'A'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): When in order to buy 1 US dollar ₹ 80 are needed instead of ₹ 75, domestic currency shows depreciation.Reason (R) : Depreciation of domestic currency refers to fall in the value of domestic currency in terms of foreign currency caused by rise in foreign exchange rate in the foreign exchange market.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions: In the following questions, a statement of assertion (A) is followed by a statement of reason (R). Mark the correct choice as:Assertion (A): When in order to buy 1 US dollar ₹ 80 are needed instead of ₹ 75, domestic currency shows depreciation.Reason (R) : Depreciation of domestic currency refers to fall in the value of domestic currency in terms of foreign currency caused by rise in foreign exchange rate in the foreign exchange market.a)Both assertion (A) and reason (R) are true and reason (R) is the correct explanation of assertion (A).b)Both assertion (A) and reason (R) are true but reason (R) is not the correct explanation of assertion (A).c)Assertion (A) is true but reason (R) is false.d)Assertion (A) is false but reason (R) is true.Correct answer is option 'A'. Can you explain this answer?.
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