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1. Exchange rate quotations and cross-exchange rate movements 1. 2. 3. STEP: 3 of 3 Suppose that one year ago the spot rate for the
1. Exchange rate quotations and cross-exchange rate movements 1. 2. 3. STEP: 3 of 3 Suppose that one year ago the spot rate for the British pound was $1.35 per pound, while the spot rate for the peso was $0.75 per peso. The cross rate of the British pound one year ago was 1 = pesos. Suppose that now the spot rate for the British pound is $2.00 per pound, while the spot rate for the peso was $1 per peso. Now the cross rate of the British pound is 1 = pesos. This represents a change in the cross rate of the British pound. 1. 2 . 3. STEP: 3 of 3 Suppose that one year ago the spot rate for the British pound was $1.35 per pound, w 11.67% pt rate for the peso was $0.75 per peso. 12.22% The cross rate of the British pound one year ago was 1 pesos. 11.11% Suppose that now the spot rate for the British pound is $2.00 per pound, while the spdi he peso was $1 per peso. 10.33% Now the cross rate of the British pound is 1 = pesos. This represents a change in the cross rate of the British pound
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