Question

30. Calculate the current exchange rate GBP/JPY, given these two quotes:
USD/JPY 114.20-30
GBP/USD 1.6750-60
A. GBP/JPY 190.71-88
B. GBP/JPY 191.29-57
C. GBP/JPY 191.40-45
D. GBP/JPY 192.07-24

Answer 1

To calculate the exchange rate for GBP/JPY using the given quotes, we can use the following relationships:

1. Convert GBP to USD using GBP/USD.
2. Convert USD to JPY using USD/JPY.

Here's the step-by-step calculation:

1. **Using the GBP/USD quote**:
- The bid price for GBP/USD is 1.6750.
- The ask price for GBP/USD is 1.6760.

2. **Using the USD/JPY quote**:
- The bid price for USD/JPY is 114.20.
- The ask price for USD/JPY is 114.30.

3. **Calculating GBP/JPY**:
- For GBP/JPY, we need to calculate the exchange rate for both the bid and ask sides.

**Bid for GBP/JPY**:
\[
\text{Bid GBP/JPY} = \text{Bid GBP/USD} \times \text{Bid USD/JPY} = 1.6750 \times 114.20
\]
\[
\text{Bid GBP/JPY} = 191.035
\]

**Ask for GBP/JPY**:
\[
\text{Ask GBP/JPY} = \text{Ask GBP/USD} \times \text{Ask USD/JPY} = 1.6760 \times 114.30
\]
\[
\text{Ask GBP/JPY} = 191.4748
\]

Rounding to two decimal places, we get the range:
\[
\text{GBP/JPY} = 191.04 - 191.47
\]

Thus the closest option based on our calculations would be:
B. GBP/JPY 191.29-57.