Chapter-4 (Currency And Exchange Rate) Notes

Currency and Exchange Rate: Notes

Mathematics • Grade 10 • Currency and Exchange Rate

1. Basic Ideas

Currency is the money used in a country (Nepal: rupee, USA: dollar, China: yuan). Exchange rate is the value of one country's currency in terms of another's. In Nepal it is declared by Nepal Rastra Bank. The rate with India is fixed (IC 100 = NRs. 160); other rates change daily.

Term	Meaning
Buying rate	Rate at which a bank buys foreign currency from you (you get NPR)
Selling rate	Rate at which a bank sells foreign currency to you (you pay NPR)

Remember: Selling rate > Buying rate, because the bank earns its profit from the difference.

Sample rates (NRB, Bhadra 5, 2079)

Currency	Unit	Buying	Selling
US Dollar	1	127.35	127.95
Euro	1	128.13	128.73
Pound Sterling	1	150.94	151.65
Australian Dollar	1	87.82	88.23
Japanese Yen	10	9.32	9.37
South Korean Won	100	9.58	9.63

Check the unit column: Yen is per 10 and Won is per 100.

2. Rules of Conversion

• Foreign → NPR: multiply by the buying rate.
• NPR → Foreign: divide by the selling rate.
• Foreign A → Foreign B (through Nepali rupees): change A to NPR at buying rate, then NPR to B at selling rate.
• Chain rule: write A = B, B = C, C = x and cross-multiply left side = right side.

Example 1. Difference between buying and selling price of £500.

Buying: 500 × 150.94 = Rs. 75,420. Selling: 500 × 151.65 = Rs. 75,825. Difference = Rs. 405

Example 2. $1 = Rs. 126.35. (a) Dollars for Rs. 85,500? (b) Rupees for $3,000?

(a) 85,500 ÷ 126.35 = $676.69
(b) 3,000 × 126.35 = Rs. 3,79,050

Example 3. (a) 1 Canadian $ into Yen. (b) 250 Australian $ into Swiss Franc.

(a) 1 CAD = Rs. 98.08 (buying); 10 Yen = Rs. 9.37 (selling). Yen = 10 × 98.08 ÷ 9.37 = 104.67 Yen
(b) 250 × 87.82 ÷ 133.76 = 164.14 Swiss Franc

Example 4 (chain rule). $500 = £390, £50 = Rs. 7,547. Dollars for Rs. 10,308?

500 × 50 × 10,308 = 390 × 7,547 × x ⇒ x = $87.55

3. Change in Value of Currency

• Inflation / appreciation of a currency: new rate = old rate + R%.
• Deflation / depreciation: new rate = old rate − R%.
• Profit or loss = final amount − amount first exchanged.

Example 5. Rs. 8,40,000 exchanged at £1 = Rs. 150. NPR deflates 5%, then he changes back. Profit or loss?

£ = 8,40,000 ÷ 150 = 5,600. New rate = 150 − 7.5 = 142.50. Rs. = 5,600 × 142.50 = 7,98,000. Loss = Rs. 42,000
(The textbook prints Rs. 2,000, but 8,40,000 − 7,98,000 = 42,000.)

4. Business with Exchange Rate

Example 6. 900 shawls bought at Rs. 4,000, 5% export tax, sold at 20% profit. €1 = Rs. 130. Selling price in Euro?

CP = 36,00,000 + 5% = 37,80,000. SP = 37,80,000 × 1.2 = 45,36,000. In Euro = 45,36,000 ÷ 130 = €34,892.30

Exam tips: (1) Identify who is buying or selling: the bank's rate is opposite to yours. (2) Always convert units (Yen ÷10, Won ÷100). (3) Add tax/VAT before finding profit %. (4) Profit % = profit ÷ cost × 100.

Currency and Exchange Rate • Grade 10 Mathematics