6. A resident of the U.S. is visiting London, England. She goes to dinner in a r

Question

6. A resident of the U.S. is visiting London, England. She goes to dinner in a restaurant in London. The total tab for the dinner, including the tip, comes to 35.70 British Pounds. She pays for the dinner using her Visa credit card. If the bank that processes her Visa credit card uses the exchange rates listed here to convert the charge from Pounds to US dollars, how much will the charge be when it shows up on her Visa bill when she gets home?

7. A marketing vice-president of AKME Gmbh., a German manufacturer of e-commerce do-it-yourself rockets is considering bidding on an order from Kayoteh LLC, a Canadian distributor. AKME sells their rockets for 500 Euros each in Germany. AKME wants to get at least this much money from any sales to Kayoteh. What is the minimum price in Canadian dollars that AKME will insist on?

8. Dexter, a genius professor at the University of Oxford in England is planning a visit to Disney World in Florida next year. He figures that he will spend $ 500 USD per day for 3 days while he visits Disney World. Using the exchange rates given in Exhibit 12, how much money does Dexter have to save in his own currency of pounds to be able to afford the trip? (consider only the daily expenses stated here)

9. Continuing from the previous question. Dexter, is still planning the same trip and is still planning to spend the same amount of money in US dollars while at Disney World. However, he checks the latest exchange rates online and discovers that the US dollar has “dropped” by 10% against the pound. In other words the US dollar is now weaker by 10%. What is the new exchange rate in terms of how many pounds can be purchased with one US dollar? (round off your answer to 2 decimal places)

10. Continuing from the previous question. Dexter is still planning the same trip and planning to spend the same amount of US dollars per day. The exchange rate has changed as you calculated in the previous question. How many pounds does Dexter now need to be able to afford this trip (be sure to use only two decimal places of the exchange rate you calculated)?

Part Two: Foreign Exchange Rates (FOREX):

The following is a table of Forex cross-rates from a few years ago:

US $

Yen

Euro

CND $

UK pound

1 USD =

1

114.71

0.69

0.93

0.48

1 Yen =

0.008718

1

0.003012

0.008146

0.004171

1 Euro =

1.4500

166.3293

1

1.3549

0.6938

1 CND $ =

1.0702

122.7633

0.7381

1

0.5121

1 UK pound =

2.0899

239.7378

1.4413

1.9528

1

Questions 6-10 use this table of Forex rates. When entering your answers, enter only the number (no sign for the currency such as “$”) and round your answer to two decimals. Show both decimals, even if they are zero.

US $

Yen

Euro

CND $

UK pound

1 USD =

1

114.71

0.69

0.93

0.48

1 Yen =

0.008718

1

0.003012

0.008146

0.004171

1 Euro =

1.4500

166.3293

1

1.3549

0.6938

1 CND $ =

1.0702

122.7633

0.7381

1

0.5121

1 UK pound =

2.0899

239.7378

1.4413

1.9528

1

Explanation / Answer

Q 6.

She is charged with the bill UK Pound 35.76 from the table above we have exchange rate for 1 UK Pound = 2.0899 USD then for 35.76 UK Pounds = 35.76*2.0899 USD = 74.74 USD

Q 7

1 EUR = 1.3549 CND S therfore 500 EUR would be =500*1.3549= 677.45 CND S they need to insist on

Q 8

Professor needs to save $500 for a trip then nhe needs to save in UK Pound is 1 USD = 1/2.0899 UK Pound therefore 500 USD = 500/2.0899 UK Pound =239.25 UK Pound

.Q 9

As USD become weak it would fetch less pounds than that of previously it is decreased by 10% therefore now 1 usd will fetch 0.9*0.48 =0.432 UK Pound hence 0.432 UK Pound would be purchased now.

Q 10

Now if he planning to spend 500 USD then he needs to save 1 USD =0.432 UK Pound

500 USD = 500*0.432 Pound =216.00

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