Determining Devaluation of Currency | International Finance

The following points highlight the two main approaches for determining devaluation of currency. The approaches are: 1. The Elasticity Approach 2. Absorption Approach. 1. The Elasticity Approach:   In fact, the success of devaluation in improving the balance of trade position of a country depends on the fulfilment of a condition known as the Mar- shall-Lerner condition. In fact, this [...]