A currency trader observes the following quotes in the spot market:
1 U)S. dollar = 122 Japanese yen
1 British pound = 2.25 Swiss francs
1 British pound = 1.65 U.S. dollars
Given this information, how many yen can be purchased for 1 Swiss franc?
A) 0.8505
B) 0.8723
C) 0.8947
D) 0.9170
E) 0.9400

Question

Quizplus · Accepted Answer

To find how many yen can be purchased for 1 Swiss franc, we need to convert Swiss francs to yen using the given exchange rates. First, convert 1 Swiss franc to British pounds: 1 CHF = 1/2.25 GBP. Then, convert GBP to USD: (1/2.25) * 1.65 USD. Finally, convert USD to yen: (1/2.25) * 1.65 * 122 JPY = 0.8947 yen.

A Currency Trader Observes the Following Quotes in the Spot