Entrepreneurship and Small Business Management

Currency Conversion

Converting Currency
The way that another country's money compares in value to the U.S. dollar is called the exchange rate. This rate is the factor you use to convert money amounts. For example, in England the currency is the pound (symbolized by ?). Suppose the exchange rate is 0.627 pounds for each U.S. dollar.

To change $20 to pounds, multiply 20 by 0.627 to get ?12.45.
To change ?20 to dollars, divide 20 by 0.627 to get $31.90.

Converting Measurements
Each type of measurement (length, weight, volume, etc.) has its own conversion factor from the U.S. to the metric system. Multiply or divide by the appropriate factor to convert measurements from one system to the other. For example, there are 2.54 centimeters in one inch.
To change 5 inches to centimeters, multiply by 2.54 to get 12.7.To change 5 centimeters to inches, divide by 2.54 to get 1.97.' >When doing business in another country, you have to be able to work with that country's currency and measurement systems. You often need to convert U.S. currency to foreign currency or express U.S. measurements in the metric system. To convert money amounts or measurements, you simply multiply or divide by a certain factor.

Converting Currency
The way that another country's money compares in value to the U.S. dollar is called the exchange rate. This rate is the factor you use to convert money amounts. For example, in England the currency is the pound (symbolized by ?). Suppose the exchange rate is 0.627 pounds for each U.S. dollar.

To change $20 to pounds, multiply 20 by 0.627 to get ?12.45.
To change ?20 to dollars, divide 20 by 0.627 to get $31.90.

Converting Measurements
Each type of measurement (length, weight, volume, etc.) has its own conversion factor from the U.S. to the metric system. Multiply or divide by the appropriate factor to convert measurements from one system to the other. For example, there are 2.54 centimeters in one inch. To change 5 inches to centimeters, multiply by 2.54 to get 12.7.To change 5 centimeters to inches, divide by 2.54 to get 1.97.

1.		If the exchange rate is 121 Japanese yen for each U.S. dollar, how many yen would you get in exchange for $55?
			A)	0.45
			B)	176
			C)	6,655
			D)	66
2.		Suppose the exchange rate for German marks is 1.87 marks per dollar. How many dollars would the bank give you in exchange for 220 marks?
			A)	$117.65
			B)	$256.55
			C)	$220.00
			D)	$101.99
3.		Your company's soda pop is sold in the U.S. in half-gallon containers. How many liters is this? (1 gal = 3.79 L)
			A)	7.6 liters
			B)	3.2 liters
			C)	1.5 liters
			D)	1.9 liters
4.		Some countries write the day first and then the month. Using this system, what date does 10/7/99 represent?
			A)	October 7, 1999
			B)	October 9, 1979
			C)	June 10, 1999
			D)	July 10, 1999
5.		While doing business in Canada, you find a sweater you want to buy. It costs $30 Canadian. What is the sweater's price in U.S. dollars if the exchange rate is 1.48 Canadian dollars per U.S. dollar?
			A)	$20.27
			B)	$31.48
			C)	$42.22
			D)	$28.52
6.		Sung's hardware manufacturing company makes screwdrivers with blades that are 0.25 inches wide. How many centimeters wide are the blades? (1 in = 2.54 cm)
			A)	1.27 cm
			B)	0.502 cm
			C)	0.635 cm
			D)	0.125 cm
7.		While in England, you need to send a product sample back home to your partner in Iowa. Packages that are less than 1 kilogram can be sent at a discount rate. You can tell by holding the sample that it weighs no more than 1.5 pounds. Will you be able to send it at the discount rate? (1 lb. = .454 kg)
			A)	No, it weighs more than 1 kg.
			B)	Yes, it weighs less than 1 kg.
			C)	No, it weighs exactly 1 kg.
			D)	I'll have to wait for an exact weight measurement at the shipper.
8.		In problem 7, it will cost you 15 pounds to send the package. Before you send it, you need to exchange some of your U.S. cash for pounds. How much of your U.S. money do you need to exchange if the exchange rate is 0.627 pounds per U.S. dollar?
			A)	$23.92
			B)	$28.05
			C)	$9.45
			D)	$5.42
9.		When you first came to Japan, the exchange rate was 115 yen for $1, so when you changed $100 into yen, you received 11,500 yen. During your visit, you did not spend the 11,500 yen, and now as you return to the U.S. you want to change that money back into dollars. The exchange rate now is 121 yen per dollar. Do you get more or less than $100? How much more or less?
			A)	about $5 more
			B)	about $3 more
			C)	about $5 less
			D)	about $3 less
10.		To avoid any confusion, which would be the best way to write the date April 5, 1999 when corresponding with a new overseas contact?
			A)	4/5/99
			B)	5/4/99
			C)	April 5, 1999
			D)	4-5-1999
11.		Rachel's Canadian client is visiting her Idaho manufacturing facility. When Rachel tells the client that the hotel is about 5 miles away, the client asks how many kilometers that is. What should Rachel tell him? (1 mi. = 1.61 km)
			A)	8.05 km
			B)	6.61 km
			C)	3.39 km
			D)	3.11 km
12.		When changing $50 into pounds at the exchange rate of 0.627 pounds per U.S. dollar, how many pounds would you receive?
			A)	42.66 pounds
			B)	79.74 pounds
			C)	62.38 pounds
			D)	31.35 pounds
13.		If the Euro exchange rate is 0.958 Euros per U.S. dollar, what is the worth, in dollars, of 250 Euros?
			A)	$239.50
			B)	$260.96
			C)	$255.49
			D)	$243.10
14.		A clothing store in Germany has agreed to sell your hand-knit scarves. You have a distinctive rack that you want them to be displayed on. The rack is 30 inches by 40 inches. What are its metric dimensions? (1 in = 2.54 cm)
			A)	54 cm by 71.19 cm
			B)	10.4 cm by 15.9 cm
			C)	76.2 cm by 101.6 cm
			D)	32.54 cm by 42.54 cm
15.		Considering the scarves in problem 14 sell for $22 in the U.S., what would be the equivalent in German currency if the exchange rate is 1.87 marks per U.S. dollar.
			A)	41.14 marks
			B)	11.76 marks
			C)	19.99 marks
			D)	22 marks
16.		You would like to buy European chairs for your restaurant. To fit with your tables, the seats of the chairs cannot be more than 20 inches high. The seats of the chairs you want to buy are 55 centimeters high. Will they work with your tables? (1 in = 2.54 cm)
			A)	Yes, they are only about 18 inches high.
			B)	Yes, they are exactly 20 inches high.
			C)	No, they are about 1 1/2 inches too high.
			D)	No, they are at least 5 inches too high.
17.		How many gallons are in a two-liter bottle? (1 gal = 3.79 L)
			A)	7.58 gal
			B)	0.53 gal
			C)	0.79 gal
			D)	4 gal
18.		Janet's backpack manufacturing company makes a backpack with a weight capacity of 40 lbs. How many kilograms can the backpack hold? (1 lb. = .454 kg)
			A)	10.2 kg
			B)	25.74 kg
			C)	18.16 kg
			D)	88.11 kg
19.		When writing numbers, people in Germany use a comma where people in the United States use a decimal point and a decimal point where people in the U.S. use a comma. Knowing this, how would you expect a German to write the number seventeen thousand, two hundred three, and six-tenths?
			A)	17,203.6
			B)	17.203,6
			C)	17,203,6
			D)	17.203.6
20.		Suppose you are in Germany and your client has just written a check to you in the amount of 1.500 marks. The bank lists the exchange rate as 1,87 German marks per U.S. dollar. How many dollars is the check worth? (Express your answer in standard U.S. number format.)
			A)	$2,805
			B)	$0.80
			C)	$2.81
			D)	$802.14