Question

Teboho wants to order a new CD from Germany. He has R250 in his savings account. The CD costs €5. Once he has bought the CD. how much money will he have left in ZAR? If he can order the same CD from Canada for $7, where must he order it from for the best price provided the shipment cost is the same.​

Answer 1

Answer: Let's assume the exchange rate between ZAR and EUR is given by E1, and the exchange rate between ZAR and CAD is given by E2.

First, let's calculate the cost of the CD in ZAR:

5 EUR * E1 = 5 * E1 ZAR

Next, let's calculate how much money Teboho will have left after purchasing the CD:

250 ZAR - 5 * E1 ZAR = 245 ZAR - 5 * E1 ZAR

Now, let's calculate the cost of the CD in CAD:

7 CAD * E2 = 7 * E2 ZAR

We need to determine the value of E1 and E2 in order to compare the prices. However, without knowing the current exchange rates, we cannot determine the best option for Teboho. If the exchange rate between ZAR and EUR is favorable and the cost of the CD in ZAR is lower than the cost of the CD in CAD, Teboho should order the CD from Germany. On the other hand, if the exchange rate between ZAR and CAD is favorable and the cost of the CD in CAD is lower than the cost of the CD in EUR, Teboho should order the CD from Canada.

Explanation: