Euro-Pound Exchange Rate Calculation
What is the euro-pound exchange rate?
Suppose you observe the following exchange rates: €1 = $1.50; £1 = $2.00. Calculate the euro-pound exchange rate.
A. €1.25 = £1.00
B. £1.3333 = €1.00
C. €3.00 = £1
D. €1.3333 = £1.00
Answer: D. €1.3333 = £1.00
The euro-pound exchange rate can be calculated by observing the given exchange rates: €1 = $1.50 and £1 = $2.00.
From the given exchange rates, it can be determined that the value of €1 is equivalent to 1.50/2.00 times the value of £1.
Therefore, €1 = $1.50 is equal to £1 = $2.00.
This implies that the value of €1 is €1 = $1.50 = £0.75.
Hence, the euro-pound exchange rate can be calculated as £1 = €1 / £0.75 = €1.3333.
So, the euro-pound exchange rate is €1.3333 = £1.00.