Question

Aya exchanged 2560 CAD for Hong Kong dollars (HKD) at an exchange rate of 1 CAD = 5.82 HKD. She later canceled her trip to Hong Kong and changed all the HKD back to Canadian dollars at an exchange rate of 1 CAD = 5.75 HKD. Did she lose any money due to the different exchange rates? Explain.

Answer 1

Aya did not lose any money from the currency exchanges; instead, she made a profit of 32.56 CAD due to the difference in exchange rates.

Step-by-step explanation:

When Aya exchanged 2560 CAD to HKD, at an exchange rate of 1 CAD = 5.82 HKD, she received a total of 2560 x 5.82 HKD. When she converted the HKD back to CAD, the exchange rate was 1 CAD = 5.75 HKD. To find out if Aya lost any money, we calculate how many CAD she gets back after the second exchange.

Lets first calculate how much HKD Aya received:
2560 CAD x 5.82 HKD/CAD = 14907.2 HKD

Now we convert the HKD back to CAD:
14907.2 HKD ÷ 5.75 HKD/CAD = 2592.56 CAD

Comparing the amount she gets back with the original amount:
2592.56 CAD - 2560 CAD = 32.56 CAD

Aya ended up with more Canadian dollars after the exchanges due to the different exchange rates, which means she did not lose any money but instead made a profit.