Suppose that the following situation exists in the foreign exchange market: 1 Canadian dollar buys $1.01 U.S, and 1 Canadian dollar buys 6.63 South African rand. How many U.S. dollars will one rand buy?
A)$6.56
B)$1.01
C)$0.17
D)$0.15
E)$6.63

Question

Quizplus · Accepted Answer

To solve this problem, we want to find the exchange rate between U.S. dollars and South African rand. We can use the given exchange rates to set up a proportion:

1 Canadian dollar/6.63 South African rand = $1.01 U.S./1 Canadian dollar

Simplifying this expression, we get:

1 U.S. dollar/ (6.63/1.01) South African rand = $1 U.S./6.56 South African rand

So, one South African rand will buy $0.152 or $0.15 U.S. dollars (rounded to two decimal places). Therefore, the answer is D.

Suppose That the Following Situation Exists in the Foreign Exchange