​A Weak Home Currency May Not Be a Perfect Solution

Multiple Choice

​A weak home currency may not be a perfect solution to correct a balance-of-trade deficit because:

A) ​it reduces the prices of imports paid by local companies.
B) ​it increases the prices of exports by local companies.
C) ​it prevents international trade transactions from being prearranged.
D) ​foreign companies may reduce the prices of their products to stay competitive.