How does a change from €0.75/$1 to €0.80/$1 affect the exchange rate?

The correct understanding of the exchange rate change from €0.75/$1 to €0.80/$1 is that it reflects how many euros can be purchased with one dollar. The previous exchange rate indicated that $1 could be exchanged for €0.75. With the new exchange rate, it now takes more euros to buy a dollar, suggesting that the dollar is becoming more expensive in terms of euros.

In this context, "previously $1 could be exchanged for €0.75" accurately describes the situation before the exchange rate change. It emphasizes the original value of the dollar against the euro, providing clarity on how the exchange rate works and how it has moved to €0.80/$1 afterwards.

This shift shows that as the euro's value increases to €0.80 for every dollar, more euros are required to obtain the same amount of dollars, which can imply depreciation of the euro or appreciation of the dollar. However, the statement regarding what could be exchanged previously is simply a factual representation of the former exchange rate.