1 . (1pt) W h ich o n e o f t h e f o ll o w i n g stat e m e n t s is c o r r e
ID: 2652579 • Letter: 1
Question
1. (1pt) Which one of the following statements is correct given the following exchange rates?
Country Us $ per 1 Foreign Unit
Fri Thur
0.1028 0.1023
0.0284 0.0286
South Africa
Thiland
A. On Thursday, one U.S. dollar was equal to 0.1023 South African rand.
B. On Friday, one Thai baht was equal to $35.21.
C. Both the South African rand and the Thai baht appreciated against the U.S. dollar from Thursday to Friday.
D. The South African rand appreciated from Thursday to Friday against the U.S. dollar.
E. The U.S. dollar depreciated from Thursday to Friday against the Thai baht.
Explanation / Answer
US $ per I Foreign unit
Country
Friday
Thursday
South Africa
0.1028
0.1023
Thailand
0.0284
0.0286
(A)- Incorrect
Actually it means 1 South African Rand = 0.1023 $
(B)- Incorrect
Quoted rate means 1 Thai baht= 0.0284 $
Or $1 = 35.21 Thai bhat
(C ) Incorrect
On Thursday we have to pay 0.1023 $ to buy one unit of SA rand and on Friday we have to pay 0.1028 $ to buy one unit of SA rand. It means SA rand value is appreciated against US dollar as we are paying more dollar to buy same amount of foreign currency.
On Thursday we have to pay 0.0286 $ to buy one unit of Thai baht and on Friday we have to pay 0.0284 $ to buy one unit Thai baht. It means Thai baht value is depreciated against US dollar as we are paying less dollar to buy same amount of foreign currency.
(D) Correct
Explanation given in part C
(E) Incorrect
Explanation as per part C
Country
Friday
Thursday
South Africa
0.1028
0.1023
Thailand
0.0284
0.0286
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