Module 8
1. Module 8
1.13. Page 2
Module 8: Daily Living
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currency: the money a country uses, such as the dollar in Canada, the pound in the United Kingdom, or the euro in the countries of the European Union
Have you purchased items over the Internet where prices were given in American dollars, British pounds, or even euros, which is the currency used by countries in the European Common Market? If you have, you know that you have to convert those currencies into Canadian dollars to estimate what the cost to you will actually be.
In the next activity you will search the Internet for particular items priced in foreign currencies. This activity will give you an idea of the relative values of these currencies.
Did You Know?
The largest bill ever printed in the United States was the 1934 gold certificate worth US$100 000.
Self-Check
© Ratmandude/Dreamstime
Heather is saving towards buying her first car. She has her eye on a subcompact, fuel-efficient hatchback. She wonders whether she would pay more or less than she would in Canada if she were to buy the car in another country.
HEATHER’S RESEARCH
Canada |
C$14 750 |
Canadian dollars |
United States |
US$12 605 |
United States dollars |
United Kingdom |
£10 256 |
United Kingdom pounds |
France |
€12 190 |
European euros |
Russia |
RUB705 000 |
Russian rubles |
Work with a partner, if possible, to complete the following questions.
SC 1. Is there something you, like Heather, would like to buy? Look up that item on the Internet and find its price in Canada and in at least three other countries. Record the prices in the currency of each country.
SC 2. Is it possible to determine where the item would be the least expensive? Why or why not?
Currency Exchange Rates
© duckman76/18746052/Fotolia
In order to travel to or do business in other countries, you must be able to convert between the currency used in your country and the currency used in the other country. For example, if you travelled to Mexico on a winter vacation, you would need to bring Mexican pesos rather than Canadian dollars. Do you know how many Mexican pesos are equivalent to C$1.00?
On February 2, 2010, C$1.00 was equal to Mex$12.1271. So, Mex$1.00 was approximately 8¢. This is an example of a currency exchange rate.
currency exchange rate: the relative value of one currency to another
The date was given for the conversion between the Canadian dollar and the Mexican peso because exchange rates are always changing. Exchange rates depend on what business and investors are willing to pay. The relative value of the Canadian dollar will rise, for example, when there is a demand for Canadian dollars to pay for the goods Canada exports or to invest in Canada.
Conversions between currencies are handled by banks, investment houses, currency exchanges, and other financial institutions. If you were travelling to the United States, you could, for instance, go to the bank or to a currency exchange kiosk at an airport to buy American dollars.