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Consider the following statements regarding Real effective exchange rate (REER).
1. The real effective exchange rate (REER) compares a nation’s currency value against the weighted average of the currencies of its major trading partners.
2. An increase in a nation’s REER is an indication that its exports are becoming more expensive and its imports are becoming cheaper.
3. India’s REER basket has remained constant for the past 10 years.
Which of the above statements is/are correct?
- a)1 only
- b)1, 2
- c)1, 3
- d)1, 2, 3
Correct answer is option 'B'. Can you explain this answer?
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Consider the following statements regarding Real effective exchange ra...
The real effective exchange rate (REER) of the rupee has remained around the benchmark (base year value of 100) for most part of the last 15 years, reflecting India’s better external competitiveness, a Reserve Bank of India study said.
The nominal effective exchange rate (NEER) and real effective exchange rate (REER) basket of the rupee is reviewed regularly.
The NEER is an index of the weighted average of bilateral exchange rates of home currency vis-a-vis currencies of trading partners, with weights derived from their shares in the trade basket of the home currency. A REER is the NEER adjusted by relative prices or costs, typically captured in inflation differentials between the home economy and trading partners.
Taking cognisance of these factors, the broad basket of NEER/ REER indices of the rupee has been expanded from 36 to 40 currencies and rebased to 2015-16.
An increase in a nation’s REER is an indication that its exports are becoming more expensive and its imports are becoming cheaper. It is losing its trade competitiveness.
Most Upvoted Answer
Consider the following statements regarding Real effective exchange ra...
's currency to a basket of other currencies, taking into account inflation and trade weights.
2. The REER is used to measure the competitiveness of a nation's exports.
3. A high REER indicates that a nation's currency is overvalued, making its exports more expensive and imports cheaper.
4. A low REER indicates that a nation's currency is undervalued, making its exports cheaper and imports more expensive.
Based on the above statements, which of the following is true about the Real effective exchange rate (REER)?
a) Statements 1, 2, and 3 are true.
b) Statements 1, 2, and 4 are true.
c) Statements 1, 3, and 4 are true.
d) All of the statements are true.
The correct answer is d) All of the statements are true.
2. The REER is used to measure the competitiveness of a nation's exports.
3. A high REER indicates that a nation's currency is overvalued, making its exports more expensive and imports cheaper.
4. A low REER indicates that a nation's currency is undervalued, making its exports cheaper and imports more expensive.
Based on the above statements, which of the following is true about the Real effective exchange rate (REER)?
a) Statements 1, 2, and 3 are true.
b) Statements 1, 2, and 4 are true.
c) Statements 1, 3, and 4 are true.
d) All of the statements are true.
The correct answer is d) All of the statements are true.
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Community Answer
Consider the following statements regarding Real effective exchange ra...
The real effective exchange rate (REER) of the rupee has remained around the benchmark (base year value of 100) for most part of the last 15 years, reflecting India’s better external competitiveness, a Reserve Bank of India study said.
The nominal effective exchange rate (NEER) and real effective exchange rate (REER) basket of the rupee is reviewed regularly.
The NEER is an index of the weighted average of bilateral exchange rates of home currency vis-a-vis currencies of trading partners, with weights derived from their shares in the trade basket of the home currency. A REER is the NEER adjusted by relative prices or costs, typically captured in inflation differentials between the home economy and trading partners.
Taking cognisance of these factors, the broad basket of NEER/ REER indices of the rupee has been expanded from 36 to 40 currencies and rebased to 2015-16.
An increase in a nation’s REER is an indication that its exports are becoming more expensive and its imports are becoming cheaper. It is losing its trade competitiveness.
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Consider the following statements regarding Real effective exchange rate (REER).1. The real effective exchange rate (REER) compares a nation’s currency value against the weighted average of the currencies of its major trading partners.2. An increase in a nation’s REER is an indication that its exports are becoming more expensive and its imports are becoming cheaper.3. India’s REER basket has remained constant for the past 10 years.Which of the above statements is/are correct?a)1 onlyb)1, 2c)1, 3d)1, 2, 3Correct answer is option 'B'. Can you explain this answer?
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Consider the following statements regarding Real effective exchange rate (REER).1. The real effective exchange rate (REER) compares a nation’s currency value against the weighted average of the currencies of its major trading partners.2. An increase in a nation’s REER is an indication that its exports are becoming more expensive and its imports are becoming cheaper.3. India’s REER basket has remained constant for the past 10 years.Which of the above statements is/are correct?a)1 onlyb)1, 2c)1, 3d)1, 2, 3Correct answer is option 'B'. Can you explain this answer? for Current Affairs 2024 is part of Current Affairs preparation. The Question and answers have been prepared according to the Current Affairs exam syllabus. Information about Consider the following statements regarding Real effective exchange rate (REER).1. The real effective exchange rate (REER) compares a nation’s currency value against the weighted average of the currencies of its major trading partners.2. An increase in a nation’s REER is an indication that its exports are becoming more expensive and its imports are becoming cheaper.3. India’s REER basket has remained constant for the past 10 years.Which of the above statements is/are correct?a)1 onlyb)1, 2c)1, 3d)1, 2, 3Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for Current Affairs 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements regarding Real effective exchange rate (REER).1. The real effective exchange rate (REER) compares a nation’s currency value against the weighted average of the currencies of its major trading partners.2. An increase in a nation’s REER is an indication that its exports are becoming more expensive and its imports are becoming cheaper.3. India’s REER basket has remained constant for the past 10 years.Which of the above statements is/are correct?a)1 onlyb)1, 2c)1, 3d)1, 2, 3Correct answer is option 'B'. Can you explain this answer?.
Consider the following statements regarding Real effective exchange rate (REER).1. The real effective exchange rate (REER) compares a nation’s currency value against the weighted average of the currencies of its major trading partners.2. An increase in a nation’s REER is an indication that its exports are becoming more expensive and its imports are becoming cheaper.3. India’s REER basket has remained constant for the past 10 years.Which of the above statements is/are correct?a)1 onlyb)1, 2c)1, 3d)1, 2, 3Correct answer is option 'B'. Can you explain this answer? for Current Affairs 2024 is part of Current Affairs preparation. The Question and answers have been prepared according to the Current Affairs exam syllabus. Information about Consider the following statements regarding Real effective exchange rate (REER).1. The real effective exchange rate (REER) compares a nation’s currency value against the weighted average of the currencies of its major trading partners.2. An increase in a nation’s REER is an indication that its exports are becoming more expensive and its imports are becoming cheaper.3. India’s REER basket has remained constant for the past 10 years.Which of the above statements is/are correct?a)1 onlyb)1, 2c)1, 3d)1, 2, 3Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for Current Affairs 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements regarding Real effective exchange rate (REER).1. The real effective exchange rate (REER) compares a nation’s currency value against the weighted average of the currencies of its major trading partners.2. An increase in a nation’s REER is an indication that its exports are becoming more expensive and its imports are becoming cheaper.3. India’s REER basket has remained constant for the past 10 years.Which of the above statements is/are correct?a)1 onlyb)1, 2c)1, 3d)1, 2, 3Correct answer is option 'B'. Can you explain this answer?.
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