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Exchange rate calculations

On May 16, the exchange rate of a German mark was $.58. On May 20, the exchange rate is $.57. Which of the following statements is true?

a. The dollar has risen against the mark
b. The dollar has fallen against the mark
c. The dollar is weaker than the mark
d. The dollar and the mark are equally strong

What causes one country's currency to rise or fall against another's?

Solution Preview

The answer is a. If a mark can be purchased for fewer dollars, then the dollar has risen ...

Solution Summary

Exchange rate calculation and reasons for currency fluctuations.