Compensation Interview Courswork Sample
Currency exchange rate keeps on varying from time to time. Some currencies appreciate while others depreciate when compared to other currencies. In the exchange rate we determine how the currency in reference is doing when compared to other currencies in the world. Currencies from the developing nations especially in Africa perform poorly when compared to other currencies in the developed nations. For this reason the currencies from the developing nations are said to be weak when compared to those from developed countries. This is due to the economic status of the nations determining the strength of the currency from a certain country or region. In our case the following are the exchange rate of the US $ in comparison to other currencies:
1. US $ exchange rates as of March 19, 2013
0.16 China (Yuan) = 1 US $
95.76 Japan (Yen) = 1US $
1.02Canada (Dollar) = 1 US $
1.81 Turkey (Lira) =1US $
1.51 German (Euro) = 1US $
1.99 Brazil (Real) = 1US $
54.29 India (Rupee) = 1 US $
12.08 Mexico (Peso) = 1 US $
1.29 UK (Pound) = 1 US $
3.75 Saudi Arabia (Riyal) = 1US $
30.86 Russia (Ruble) = 1US $
9.32 South Africa (Rand) = 1US $
6.47 Sweden (Krona) = 1US $
9716.01 Indonesia (Rupiah) =1US $
1.047 Australia (Dollar) = 1 US $
2.In the export and import market affairs, a country has to convert its currency to the currency of the country it intends to purchase items from. For example if Japan intends to buy some materials from China, there has to be some currency conversions to facilitate easy transactions between the two nations. In our case the two trading countries, China and Japan have first to have a common currency. Jpan has to v=convert its Yen into the Chinese currency (Yuan). The exchange of the currencies helps to make the business transactions easy and fast. In most cases there has to be currency exchange if the trade being carried out involves parties or countries having a different currency. This facilitates smooth transactions between the trading partners. For example in our case the Japanese auto company has to convert its currency in to the Chinese Yuan for transactions to be carried out.
1 US $ = 0.16 Chinese Yuan
Therefore 9,030,200 Yuan =
=56438750 US $
But 1 US $= 95.76 Japanese Yen
= 5404574700 Yens.
In every country there is a currency exchange body and its main work is to facilitate exchange of currencies for the different countries. The task carried out by these currency exchange bodies is very vital in facilitating external trade between the country and other nations. The currency exchange also facilitates other sectors of trade like the tourism industry. The exchange of currency helps the incoming tourists to acquire the currency of the country they travel to. Having acquired the currency used in the country, the tourists can now easily purchase goods sold in that country and pay for the services.
1 bond = 9,500,000 Rupiah
750 bonds= 750 * 9,500,000= 7125000000
But 1US $=9716.01 Rupiah
Therefore buying 750 bonds would be: 7125000000/9716.01= 733325.72 US$
But 1 US$= 1.99 Real
Therefore to buy 750 bonds: 1.99 * 733325.72 = 1459318.18 Brazil Real
In some cases, the currency of a certain country may depreciate or appreciate when compared to other currencies. When a currency depreciates, it is said to be performing poorly in the outside market. The rate of appreciation or depreciation is measured in terms of percentage. There are some reasons making a currency to appreciate or depreciate. The major factor is the value of the country’s exports when compared to the imports the country gets from the partner trading nations. If the country is exporting less and importing more, the value of the currency in that country depreciates. It is therefore the obligation of the government in such a country to try and minimize the imports and at the same time increase the value of its exports.
On the other hand, the currency of a country or a certain region appreciates due to some factors. The major one still lies on the exports and the imports the country gets from the trading partner country. For example if a country is exporting more and importing less goods or services, the value of the country’s currency appreciates. Appreciation of a currency is also a result of the exports the country sells to the external markets. If the exports are of a high value, they fetch more money and hence the value of the country’s currency will appreciate.
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