Devaluation in Fixed Exchange Rates

Steps:

• Identify fixed exchange rate: government sets currency value against another.
• Note "price reduced": official lowering of currency's fixed value.
• Distinguish terms: devaluation applies to deliberate cuts in fixed systems.
• Eliminate opposites: appreciation/revaluation raise value; depreciation fits floating rates.

Why C is correct:

• Devaluation is the official reduction of a currency's fixed exchange rate, directly lowering its price against foreign currencies.

Why the others are wrong:

• A: Appreciation increases a currency's value.
• B: Depreciation occurs in floating systems via market forces.
• D: Revaluation raises a currency's fixed value.

Final answer: C