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In the context of devaluation policy, why is elasticity important?
  • a)
    To assess the impact on demand for exports and imports
  • b)
    To maximize government revenue
  • c)
    To stabilize currency values
  • d)
    To predict consumer behavior
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
In the context of devaluation policy, why is elasticity important?a) T...
Elasticity is crucial in devaluation policy because it helps predict how demand for exports and imports will change in response to currency fluctuations. Understanding elasticity allows policymakers to anticipate economic impacts and make informed decisions.
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