Currency Equivalents and Changing Money

In the U.S. and around the world, money can be changed from one currency to another at most commercial banks. In New York City, for example, you can exchange a U.S. dollar bill for Brazilian cruzeiros, Italian lire or Sri Lankan rupees at most large banks. The rates of exchange change daily. The exchange rate tells you how much foreign money is required to buy an American dollar. Banks will charge a small commission for this service. New York City is an international banking center. By 1991, foreign banks had 463 offices in New York City, and New York's own banks and financial institutions, such as American Express, Citibank, and Chase Manhattan, have branches around the world. Changing money is only one of a number of services that banks perform in today's global economy. Reflect the Currency Chart. It indicate what the American dollar and other currencies are worth on a certain day. The currencies change in value daily, so that world events, or crises in the money markets of the world, may have serious effects on the value of money on any one day. Given this information, how would you respond to each of these situations? Your cousin in Brazil sent you a record for Christmas. You noticed the price tag was still on the record. It cost 7,160 cruzeiros. You want to send a gift in return that costs about the same amount in U.S. dollars What will you have to spend? You want to order a sweater shown in a catalogue from a store in London, Great Britain. In the catalogue the price of the sweater is 20 pounds. About how many dollars will it cost you? You are traveling in Mexico. You can only afford to spend $15 a night on a hotel. You have just arrived at a hotel and notice a list of prices-single rooms start at $1,578 a night. The hotel desk clerk notices your look of shock and explains that in Mexico the "$" means "pesos." Can you afford the room?