1. International Economics Currency Exchange
SSEIN3 Explain how changes in exchange rates can have an impact on the purchasing power of groups in the United States and in other countries.
Define exchange rate
Changes in exchange rates: appreciation and depreciation
Changes in exchange rates: winners & losers

2. €₵u₹₹€n₵¥ €x₵hang€   Exchange rate
The value of one currency compared to another
$1 = €0.84½ or $1.18 = € 1
What causes a change in exchange rates?
But if they ask, supply & demand
 

3. €₵u₹₹€n₵¥ €x₵hang€ = = = OR
Appreciation: Currency increases in value in relation to another currency = OR = =

4. €₵u₹₹€n₵¥ €x₵hang€ OR = = = = =
Appreciation Currency increases in value in relation to another currency
Depreciation Currency decreases in value in relation to another currency = = = = OR =

5. €₵u₹₹€n₵¥ €x₵hang€
When a currency like the $ appreciates (grows stronger) in relation to another currency, the $ buys more of their stuff.
This means…
More Americans visit there
Fewer of them visit here
America imports more of their goods
And they import less from us
America’s trade deficit will increase