If the dinar devalues against the U.S.dollar by 45%,the U.S.dollar will appreciate against the dinar by
A)45%
B)82%
C)55%
D)32%

Question

Quizplus · Accepted Answer

If the dinar devalues by 45%, then the new exchange rate would be 1 dinar = 0.55 USD (a 45% decrease in value from the previous rate of 1 dinar = 1 USD). To find the percentage change in the USD against the dinar, we can use the formula:

[(new value - old value) / old value] x 100

[(0.55 - 1) / 1] x 100 = -45%

However, we are looking for the change in the USD against the dinar, so we need to flip the percentage to get a positive number:

45% x (-1) = -45%

Therefore, the USD will appreciate against the dinar by 45% x 1.82 (the inverse of the original 1 dinar = 1 USD rate) = 82%.

If the Dinar Devalues Against the U