if the exchange rate changes from 3 brazilian reals per dollar to 4 reals per dollar, a. the dollar has depreciated. b. the dollar has appreciated. c. the dollar could have appreciated or depreciated depending on what happened to relative prices in brazil and the united states. d. none of the above is true.

Respuesta :

The correct answer is a) the dollar has depreciated. If the exchange rate falls from 3 to 4 Brazilian reals to the dollar, the value of the currency has decreased.

How is the real doing in 2022 so far? One of the best-performing currencies to begin the year was the Brazilian real, which saw gains from growing commodity prices, increased interest from investors withdrawing money from Russian assets, and a significant increase in Brazil's benchmark interest rate from 2% to 11.75% in only one year.

The BCB does not interfere in the FX market to control the exchange rate level because the Brazilian economy runs under a floating exchange rate regime and the inflation-targeting regime.

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