Among the following countries, which one has experienced a severe drop in its currency value during the last couple of decades?

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BlackTom AI · Accepted Answer

Consider the question about which country has experienced a severe drop in its currency value over the last couple of decades.
Option 1 (Zimbabwe): This choice describes a real and well-documented currency collapse. Zimbabwe experienced hyperinflation and a dramatic devaluation of the Zimbabwean dollar, effectively rendering the currency worthless at times and leading to extensive periods of loss of confidence and replacement by other currencies in daily transactions. The severity and duration of this collapse distinguish it from typical fluctuations.
Option 2 (Japan): While the Japanese yen has faced significant depreciation at times, especially in periods of monetary easing, the overall narrative is not one of a currency going to near-worthlessness for an extended span like Zimbabwe. Japan also has a history of deflationary pressure, but that is different from the extreme, sustained devaluation referenced in the prompt.
Option 3 (New Zealand): The New Zealand dollar has experienced volatility and periods of depreciation, but there has not been a comparable, sustained collapse in value over decades. Its currency remains broadly stable relative to major trading partners, and the scale of drop does not match the Zimbabwean episode.
Option 4 (Canada): The Canadian dollar has fluctuated with commodity prices and global conditions, yet it has not undergone a severe, long-term collapse akin to a hyperinflationary currency. Canada maintains monetary stability and relatively orderly exchange-rate movements.
In summary, the most fitting description of a severe, decades-spanning currency collapse among the options is Zimbabwe, whereas the other countries show only more typical currency fluctuations or more moderate depreciation without a terminal collapse.

01:220:300:01 INTERNATIONAL ECON Introduction to international macroeconomics practice questions (not for credit)

Among the following countries, which one has experienced a severe drop in its currency value during the last couple of decades?

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