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tankabanditka [31]
2 years ago
4

Suppose that the exchange rate is .60 dollars per swiss franc. if the franc appreciates 10% against the dollar how many francs w

ould a dollar buy tomorrow?
Business
1 answer:
Sunny_sXe [5.5K]2 years ago
5 0

<span>Answer: 1.5152</span>

<span>The ratio of the exchange rate of the dollar to Swiss franc is .60:1. It means that .60 dollar can buy 1 Swiss francs.  If the franc appreciates by 10% against a dollar by tomorrow, then the number of francs a dollar can buy is: </span>

You need 10% more USD to buy one appreciated Swiss franc. 

<span>The previous ratio is .60:1</span>

When franc appreciates by 10% against the dollar, the ratio becomes (0.6+.10(,6):1 or .66:1

To get the number of francs (X) a dollar can now buy, we use the following equation

.66:1=1:X

.66X=1

X=1/.66

X= <span>1.515152 or 1.5152</span>

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