Multiple choice

Devaluation means

  1. reduction in interest rates on export loans

  2. reduction in the value of home currency in terms of other currencies

  3. subsidy on exports to make them cheaper in other countries

  4. subsidy on imports to make them cheaper in India
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Devaluation refers to the deliberate reduction in the value of a country's currency relative to other currencies. This is typically done by the central government or monetary authority to make exports more competitive and reduce imports. It is different from changing interest rates or providing subsidies.

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