Brett, a U.S. student, is preparing for a trip to Thailand in the near future. He read in The Wall Street Journal that the dollar has strength against the Thai baht. Which of the following would be an exchange that would indicate this currency situation?
A) 10 U.S. dollars for 1 baht.
B) 1 U.S. dollar for 1 baht.
C) 1 U.S. dollar for .22 baht.
D) 1 U.S. dollar for 34.78 baht.

Question

Quizplus · Accepted Answer

The exchange rate of 1 U.S. dollar for 34.78 baht indicates that the dollar has strength against the Thai baht since Brett would receive more baht for each dollar exchanged. Choice A indicates a weak dollar, while choices B and C indicate a strong baht.