Question

Suppose that you are a U.S. producer of a commodity good competing with foreign producers. Your inputs of production are priced in dollars and you sell your output in dollars. If the U.S. currency depreciates against the currencies of our trading partners:
a. Your competitive position is likely worsened
b. Your competitive position is likely improved
c. Your competitive position is unchanged

Answer 1

Answer:

B)your competitive position is likely to improve.

Explanation:

From the question we are informed about an instance, whereby I'm a U.S. producer of a commodity good competing with foreign producers. My inputs of production are priced in dollars and you sell your output in dollars. In this case, If the U.S. currency depreciates against the currencies of our trading partners then my competitive position is likely improved. Competitive position can be regarded as value that is been offered by a product/service or it's band in regards to some offerings in a market. To model this, a simple graph is used which called "competitive position map" where one's offerings is plotted against the competition parameters.