Assume the exchange rate for PNG alters from 32 to 43 Japanese Yen, what will happen to PNG kina relative to the Japanese Yen? Answer in one short sentence.

Answer 1

The PNG kina will depreciate relative to the Japanese Yen.

Answer 2

I thought it will appreciate

Answer 3

If the exchange rate of PNG kina changes from 32 to 43 Japanese Yen, it indicates that you need more Yen to buy the same amount of Kina, meaning the Kina has depreciated relative to the Yen.

Answer 4

Doesn't that mean the Kina has appreciated so you need more.

Answer 5

I apologize for any confusion. When the exchange rate increases from 32 to 43 Japanese Yen per PNG kina, it means the kina has appreciated because it now takes more Yen to buy one kina. So, you are correct: the PNG kina appreciates relative to the Japanese Yen in this case. Thank you for your patience!

Answer 6

OK so in terms of cost, what will happen to the Japanese import? Answer in one short sentence.

Answer 7

Japanese imports from Papua New Guinea will become more expensive.

Answer 8

And in terms of volume, what will happen to the Japanese import?

Answer 9

The volume of Japanese imports from Papua New Guinea is likely to decrease.