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This is from the technical article on Foreign Currency Risk:
E/£ 1.2025 + – 0.03 giving spot rates 1.2028 – 1.2022But what about this one: (This is the ‘SDT’ company question if you have the BPP kit)
Yen/ £ 199.887 + – 0.9 giving a rate of 200.032
What are the rules when the spots are given in this + – format?
Thanks in advance.
+,- format means you have to add it and then substract it from the single rate given in the question. then you get two rates that is sell and buy rate of currency.
Hi. Yep, I understand that for the first one. But adding 0.9 to 199.887 gives 200.787 not 200.032
Expansion on the question:
How do you calculate these spot rates?
Yen/ £ 199.887 + – 0.9 giving a rate of 200.032
US$/ £ 1.7723 + – 0.0103 giving a rate of 1.7775
Euro/ £ 1.4708 + – 0.0105 giving a rate of 1.4784So, when I add 1.7723 + 0.0103, I get 1.7826, not 1.7775
And when I add 1.4708 + 0.0105, I get 1.4813 not 1.4784Cheers
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