Ask Question
14 August, 18:42

The exchange rate at the beginning of a year between the Indian Rupee (R) and the U. S. dollar is R43.125/$. The annual inflation rates in India and in the United States are 19 percent and 3 percent respectively. What would be the new exchange rate at the end of the year? R37.327/$ R0.0267/$ R49.8224/$ $37.327/R

+4
Answers (1)
  1. 14 August, 18:50
    0
    The correct answer is R49.8224/$.

    Explanation:

    According to the scenario, the computation of the given data are as follows:

    Exchange rate at beginning = R43.125/$

    Inflation rate in India = 19%

    Inflation rate in U. S. = 3 %

    So, we can calculate the New exchange rate by using following formula:

    New exchange rate = Beginning exchange rate * (Inflation A : Inflation B)

    = R 43.125 * (1.19 : 1.03)

    = R 49.8224/$
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “The exchange rate at the beginning of a year between the Indian Rupee (R) and the U. S. dollar is R43.125/$. The annual inflation rates in ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers