The value of one U.S. dollar is 60 Indian Rupees today, compared to 45 Indian Rupees last year. The Indian Rupee has _________. A. Depressed B. Depreciated C. Appreciated D. Stabilized

GATE 2014 · General Aptitude · Most Appropriate Word · medium

Answer: B. Depreciated

1. Interpret the exchange rate change: Last year: $1 = 45 Rs. Today: $1 = 60 Rs. The number of Rupees per dollar increased, so the Rupee is now weaker — it buys fewer dollars than before.
2. Apply the correct economic term: When a currency loses value against another, it has 'depreciated'. 'Appreciated' = gained value (wrong). 'Depressed' = used for economy, not currency (wrong). 'Stabilized' = stayed the same (wrong).
3. Confirm the answer: The Indian Rupee has DEPRECIATED, because it takes more Rupees now to buy one U.S. dollar.