Question

I'm not sure if it's the right formula

Isaac Díez Peris lives in Rio de Janeiro. While attending school in Spain he meets Juan Carlos Cordero from Guatemala. Over the summer holiday Isaac decides to visit Juan Carlos in Guatemala City for a couple of weeks. Isaac's parents give him some spending money, R$4,500. Isaac wants to exchange it to Guatemlan quetzals (GTQ). He collects the following rates: Spot rate on the R$/€ cross rate Spot rate on the €/GTQ cross rate R$ 10.57997€ €0.4462/GTQ 1 a. What is the Brazilian reais/Guatemalan quetzal cross rate? b. How many quetzals will Isaac get for his reais? º get for his reais? (€7R0) GTQ1€) Assumptions Amount of reais from parents Spot rate (R$/€) Spot rate (E/GTQ) Values 4,500.00 10.5799 0.4462 a. What is the R$/GTQ cross rate? Cross rate (R$/GTQ) b. How many quetzals will he get for his reais? Converting your reais into quetzals

Answer 1

a). Calculating R$/GTQ Cross Rate

R$/GTQ= (R$/€)*(€/GTQ)

Spot rate (R$/€)= 10.5799

Spot rate(€/GTQ) = 0.4462

R$/GTQ= 10.5799*.4462

= R$ 4.7207/GTQ

B). Quetzels to be received against R$ 4500

= R$ 4500/(R$ 4.7207/GTQ)

= GTQ 953.2485

So, he will receive 953.2485 Quetzels