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Other things the same, as the price level falls, the exchange rate rises. A rise in...

Other things the same, as the price level falls, the exchange rate rises. A rise in the exchange rate leads to a decrease in net exports.

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A rise in the exchange rate leads to a decrease in net exports because the price of the domestic products is high than the price of the foreign goods.So imports become cheaper than the exported goods.Thus it leads to rise in the exchange rate as net exports and imports decreases.

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