Exchange Rates and Currency Exchange

This page discusses how to calculate currency exchange rates and exchange rates. An exchange rate is the value of a state's currency's value compared to another state's. In addition to the rates we examined previously, there are other exchange rates, known as the onshore and offshore rates. An onshore rate favors the national currency traded within its borders. In contrast, an offshore rate is slightly higher for national currency traded outside the state's borders. What is the relationship between restricted currency and the offshore exchange rate?

Things To Watch Out For

Exercise 7.3.2 : Give It Some Thought

  1. If the exchange rate in terms of US dollars per unit of euros increases, which currency weakened?
  2. If the Australian dollar weakens against the Canadian dollar, did the exchange rate increase or decrease in terms of Australian dollars per unit of Canadian dollars?
  3. If the exchange rate in terms of yen per unit of the Mexican pesos decreases, which currency weakened?
  4. If the British pound (£) appreciates against the US dollar, did the exchange rate increase or decrease in terms of pounds per unit of US dollars?