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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

1 answer

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.