1.Suppose that the quote for the CAD in New York is 0.6666 USD/CAD. What is the quote for USD in Toronto (CAD/USD)?

A)   0.3333.

B)   0.6666.

C)   1.5001.

D)   1.0000.

2.In Japan, the direct quote of 108.82 Japanese yen per U.S. dollar (JPY/USD) is the equivalent of an indirect quote of:

A)   0.091895 USD/JPY.

B)   0.918949 USD/JPY.

C)   9.189490 USD/JPY.

D)   0.009189 USD/JPY.

3.If the exchange rate value of the CAD goes from USD 0.60 to USD 0.80, then the CAD:

A)   appreciated and Canadians will find U.S. goods cheaper.

B)   depreciated and Canadians will find U.S. goods cheaper.

C)   depreciated and Canadians will find U.S. goods more expensive.

D)   appreciated and Canadians will find U.S. goods more expensive.

4.In the U.S., the indirect quote of 0.827541 euros per U.S. dollar (EUR/USD) is the equivalent of a direct quote of:

A)   0.1208 USD/EUR.

B)   0.0121 USD/EUR.

C)   1.2084 USD/EUR.

D)   0.0012 USD/EUR.

5.Given an indirect quote of 2.2254 CHF/GBP, what is the direct quote?

A)   4.4940 GBP/CHF.

B)   0.0449 GBP/CHF.

C)   0.0044 GBP/CHF.

D)   0.4494 GBP/CHF.

6.If the exchange rate is JPY120/USD1, a bottle of rice wine that costs JPY2,400 costs:

A)   USD 24.

B)   USD 20.

C)   USD 200.

D)   USD 2,400.

1.Suppose that the quote for the CAD in New York is 0.6666 USD/CAD. What is the quote for USD in Toronto (CAD/USD)?

A)   0.3333.

B)   0.6666.

C)   1.5001.

D)   1.0000.

The correct answer was C)

Take the reciprocal of 0.6666 = 1 / 0.6666 = 1.5001

2.In Japan, the direct quote of 108.82 Japanese yen per U.S. dollar (JPY/USD) is the equivalent of an indirect quote of:

A)   0.091895 USD/JPY.

B)   0.918949 USD/JPY.

C)   9.189490 USD/JPY.

D)   0.009189 USD/JPY.

The correct answer was D)

0.009189 USD/JPY is the reciprocal of 108.82 JPY/USD.

3.If the exchange rate value of the CAD goes from USD 0.60 to USD 0.80, then the CAD:

A)   appreciated and Canadians will find U.S. goods cheaper.

B)   depreciated and Canadians will find U.S. goods cheaper.

C)   depreciated and Canadians will find U.S. goods more expensive.

D)   appreciated and Canadians will find U.S. goods more expensive.

The correct answer was A)

The CAD is now more expensive in terms of USD, and thus it has appreciated. Therefore, each CAD yields more USD than before, and Canadians are able to purchase more U.S. goods with each CAD, making U.S. goods relatively cheaper.

4.In the U.S., the indirect quote of 0.827541 euros per U.S. dollar (EUR/USD) is the equivalent of a direct quote of:

A)   0.1208 USD/EUR.

B)   0.0121 USD/EUR.

C)   1.2084 USD/EUR.

D)   0.0012 USD/EUR.

The correct answer was C)

1.2084 USD/EUR is the reciprocal of 0.827541 EUR/USD.

5.Given an indirect quote of 2.2254 CHF/GBP, what is the direct quote?

A)   4.4940 GBP/CHF.

B)   0.0449 GBP/CHF.

C)   0.0044 GBP/CHF.

D)   0.4494 GBP/CHF.

The correct answer was D)

0.4494 GBP/CHF is the reciprocal of 2.2254 CHF/GBP.

6.If the exchange rate is JPY120/USD1, a bottle of rice wine that costs JPY2,400 costs:

A)   USD 24.

B)   USD 20.

C)   USD 200.

D)   USD 2,400.

The correct answer was B)

If USD1 buys JPY120, USD20 buys JPY2,400, which is the price of the bottle of wine. (USD/JPY120)*(JPY2,400/wine) = USD20/wine