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Exchange Rate Slide Show
- 2. The amount of foreign currency that can be bought for one’s own currency is called the exchange rate for that currency. Example: €1= £0.88, $1.39
- 3. Can be bought in banks, building societies, credit unions, post offices and in bureaux de change.
- 4. If you wish to buy foreign currency you refer to the “We Sell” price, i.e. the price which the agency will sell to you.
- 5. WE
- 6. We Buy We Sell 1.34 1.30
- 7. “We Sell”
- 8. If you wish to sell foreign currency you refer to the “We Buy” price, i.e. the price for which the agency will buy the currency from you
- 9. We Buy We Sell 1.34 1.30
- 10. “We Buy”
- 11. When you are using the “We Sell” you Multiply by quoted amount
- 12. When you are using “We Buy” you divide by quoted amount
- 13. John wishes to exchange €1000 for US dollars and gets the following exchange rates We Buy We Sell 1.34 1.30
- 14. John arrives home from his business trip with $100 and wishes to change it back to Euros We Buy We Sell 1.34 1.30
- 15. http://www.xe.com/
Editor's Notes
- So who is “we”?Its important to understand “we” always refers to the Financial Institutions offering the currency conversion
- This slide tells the story of “John” who needs to go to the USA on a Business tripThe slide transitions are set up to allow us to understand the process behind acquiring a different currency. The bank agrees to sell the currency (we sell) to JohnThe bank will give John $1.30 for every Euro John gives the bankThe figures quoted ALWAYS relate to to foreign currency being discussed
- The transitions in this slide tell the story of John returning from his business tripHe did not spend all his dollars and now as he is back in Ireland requires EurosJohn goes to the bank and the bank agree to buy Johns dollars (We Buy)The bank will give John €1 for every $1.34 John gives to the bank
- Follow the rules here: John has Euros ( ie the domestic currency) therefore we will be multiplyingThe bank will sell John his dollars1.30 x 1000
- We are not beginning with Euros here therefore we need to buy themWhen we use we buy we divide100/1.34