Suppose that the current exchange rate is £1.00 = $1.50. The indirect quote from the U.S. perspective is £1.00 = $1.50.$0.67 = £1.00.£0.67 = $1.00.all choices are incorrect.

Question

Suppose that the current exchange rate is £1.00 = $1.50. The indirect quote from the U.S. perspective is £1.00 =$ 1.50. $0.67 = £1.00.£0.67 =$ 1.00.all choices are incorrect.

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Solution

The correct answer is $0.67 = £1.00. This is the indirect quote from the U.S. perspective. It means that for every 1 British pound, you get 0.67 U.S. dollars.

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