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When there is an official change in the exchange rate of domestic currency, then it is called :
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- Appreciation
- Depreciation
- Revaluation
- Deflation
- Appreciation
Correct Option: C
Revaluation is a calculated adjustment to a country’s official exchange rate relative to a chosen baseline. The baseline can be anything from wage rates to the price of gold to a foreign currency. In a fixed exchange rate regime, only a decision by a country’s government (i.e. central bank) can alter the official value of the currency. It is opposite of devaluation.