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    foreign exchange market

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    A bicycle manufactured in the United States costs $100. Using the
    exchange rates listed in the table to the right, what would the bicycle
    cost in each of the following countries?

    a) Argentina
    b) Britain
    c) Canada

    Country U.S. $ per Currency Currency per U.S. $
    Argentina (peso) 0.3269 3.0590
    Australia (dollar) 0.7543 1.3257
    Britain (pound) 1.7705 0.5648
    Canada (dollar) 0.8583 1.1651
    China (renminbi) 0.1240 8.0655
    Israel (shekel) 0.2165 4.6189
    Japan (yen) 0.0087 114.42
    Mexico (peso) 0.0947 10.5652
    New Zealand (dollar) 0.6917 1.4457
    Russia (ruble) 0.0349 28.670
    Singapore (dollar) 0.6105 1.6380
    Switzerland (franc) 0.7876 1.2697
    EU (euro) 1.2154 0.8262

    Note: the second column lists U.S. dollars per unit of foreign currency, or how much one unit of foreign currency is worth in U.S. dollars. The third column lists units of foreign currency per U.S. dollar, or how much 1 U.S. dollar is worth in foreign currency.

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    Solution Preview

    The only thing that needs to be done here is that you have to calculate the equivalent currency unit in each of the destination countries. This means you need to find the value of $100 in each of those ...

    Solution Summary

    The foreign exchange market is illustrated in the solution.