Do you think the sentence is logical? What does this sentence mean? Thank you.
We’re losing a lot of business because our currency is so strong at the moment.
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Answers · 3
1
It's makes perfect sense... it means that a company/country/whoever is "we" is losing a lot of business because the currency where they operate is strong.
When a currency is strong relative to other currencies, it becomes difficult to export goods because they are so expensive for people/businesses in foreign countries to buy.
Eg. if the currency (£) is strong and £1 = $2, then an American has to spend $2000 to buy a car that costs £1000 to make in Britain.
BUT: If the currency (£) is weaker, and £1 = $1, then an American has to spend only $1000 to buy a car that costs £1000 in Britain.
Because the American citizen has to spend less dollars when the British currency is weak, it's easier for Britain to export goods there.
The other effect of having a strong currency, however, is that it becomes much cheaper to import goods.
It's all a careful economic balance though because if your currency is strong then it is cheaper to import raw materials needed for production. Matters of currency are very complex but I've tried to give a simple explanation.
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Good luck and take care :)!
0
You're welcome :)!
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