Chunnel Choices. The Channel Tunnel or “Chunnel”

passes underneath the English Channel between Great Britain and France, a land-link between the Continent and the British Isles. One side is therefore an economy of British pounds, the other euros. If you were to check the Chunnel’s rail ticket Internet rates you would find that they would be denominated in U.S. dollars (USD). For example, a first class round trip fare for a single adult from London to Paris via the Chunnel through RailEurope may cost USD170.00.

This currency neutrality, however, means that customers on both ends of the Chunnel pay differing rates in their home currencies from day to day. What is the British pound and euro denominated prices for the USD170.00 round trip fare in local currency if purchased on the following dates at the accompanying spot rates drawn from the Financial Times?

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British Pound Date of Spot Spot Rate Euro Spot Rate (/$) Rate (/$) Monday 0.5702 0.8304 Tuesday 0.5712 0.8293 Wednesday 0.5756 0.8340