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UPSC 1999: Assertion (A): Devaluation of a currency may promote export. Reason (R): Price of the country's products in the international market may fall due to devaluation.
(a)Both A and R are true, and R is the correct explanation of A
(b)Both A and R are true, but R is not a correct explanation of A
(c)A is true, but R is false
(d)A is false, but R is true
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Not attemptedCorrect Answer: (a) Both A and R are true, and R is the correct explanation of A
Devaluation lowers the external value of the domestic currency, so foreign buyers need fewer units of their own currency to buy the same Indian goods; this makes Indian exports cheaper and more competitive, boosting export volumes. Hence both statements are true and the fall in international price directly explains why devaluation promotes exports. ([licchavilyceum.com](https://licchavilyceum.com/upsc-civil-services-prelims-1999-solved-question-paper/))
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What is the correct answer to this UPSC 1999 Indian Economy question?▼
The correct answer is option (a): Both A and R are true, and R is the correct explanation of A. Watch the detailed video explanation in our Sherlocking Prelims course on UnlockIAS.
Which year was this External Sector & Balance Of Payments question asked in UPSC Prelims?▼
This question was asked in UPSC CSE Prelims 1999, GS Paper 1, as Question 99. It falls under Indian Economy > External Sector & Balance Of Payments.
What is the difficulty level of this UPSC question?▼
This question is rated "easy". It tests basic recall and most well-prepared aspirants should answer it correctly.
How many UPSC Prelims questions have been asked from External Sector & Balance Of Payments?▼
UPSC has asked 49 questions from External Sector & Balance Of Payments (under Indian Economy) across multiple years. Visit the topic page to see the full list and year-wise trends.