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Unit 14 - Lesson 3
Learning outcomes:
Evaluate the possible economic consequences of a change in the
value of a currency, including the effects on a countrys inflation rate,
employment, economic growth and current account balance.
Rate of Inflation
Employment
Economic Growth
Current Account Balance
Foreign Debt
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Currency Appreciation:
Appreciation makes
imports cheaper.
Results in lowering
the inflationary
pressure caused by
Domestic Producers
importing Factors of
Production
Foreign Debt
If Tanzania borrows money from the European Union.
Currency Depreciation
Depreciation of the Tsh in relation to the Euro will cause the amount owed to the
European Union to increase due to the Depreciation.
Currency Appreciation
Appreciation of the Tsh in relation to the Euro will cause the amount owed to the
European Union to decrease due to the Appreciation.