Question: The current yendollar exchange rate is
around 114. What is the new yendollar
exchange rate if this exchange rate increases by 10 percent? What was the dollaryen exchange rate when
the yendollar exchange rate was 114?
What is then new dollaryen exchange rate after the yendollar exchange
rate increases by 10 percent?
What is the relationship between the percentage change in the
yen dollar exchange rate and the dollaryen exchange rate?
Answer: The calculations requested in this problem
are summarized in the table below.
Percentage Change in
Ratios  Illustrated Through
Exchange Rates


Current Exchange Rate Yen
per dollar

114

Current Exchange Rate
Dollar Per Yen

0.00877193

Factor increasing
yen/Dollar Rate

1.1

New YenDollar Rate

125.4

New Dollar Yen Rate

0.007974482

Factor Increasing
Dollar/Yen Rate

0.909090909

Reciprocal of Factor
Impacting Yen/Dollar Rate

0.909090909

% Change in Yen Dollar
Rate

0.1

% Change in Dollar Yen
Rate

0.090909091

Observations:
A ten percent change
in the yen/dollar rate is the same as multiplying the dollar yen rate by 1/1.10
or 0.90909.
A ten percentage point increase in the yen/dollar rate is
the same as a 9.0909 percentage point decrease in the dollaryen rate.
I am also teaching exchange rate math at fraction tips:
Exchange rate math problems at fraction tips:
http://fractiontips.blogspot.com/2014/11/exchangeratemathpostone.html
I am also teaching exchange rate math at fraction tips:
Exchange rate math problems at fraction tips:
http://fractiontips.blogspot.com/2014/11/exchangeratemathpostone.html
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