Explanation

When a country's currency depreciates:

• Export prices in foreign currency terms (Option A) would typically decrease, making exports cheaper for foreign buyers
• Export prices in domestic currency terms (Option B) would remain relatively unchanged or could increase slightly due to higher demand
• Import prices in domestic currency terms (Option C) would increase significantly because it takes more domestic currency to buy the same amount of foreign goods

For a country with a current account deficit, currency depreciation makes imports more expensive in domestic currency terms, which can help reduce the deficit by discouraging imports and making exports more competitive abroad.

Correct Answer: C - Import prices in domestic currency terms will increase.