Final answer:
To find the KES/USD bid rate, we convert KES to GBP and then GBP to USD. The KES/GBP bid rate is 152.85 KES/GBP and the GBP/USD bid rate is 0.84 GBP/USD. After conversion, we get 182.15 KES/USD, which is none of the provided options; thus, we indicate the closest one, 169.8. The correct answer is option d.
Step-by-step explanation:
To find the KES/USD bid rate, we first need to use the given exchange rates to convert Kenyan Shillings (KES) to US Dollars (USD) indirectly through British Pounds (GBP) and then through Ugandan Shillings (UGX). We use the bid rates, meaning we use the lower value of the given spreads (rates at which the market is willing to buy the currency).
The KES/GBP bid rate is 152.85. The GBP/USD bid rate is 0.84. We first convert KES to GBP and then use the GBP/USD rate to find the KES/USD rate:
- 1 KES = 1/152.85 GBP
- 1 GBP = 0.84 USD
- Therefore, 1 KES = (1/152.85) * 0.84 USD
- To find the value, divide 0.84 by 152.85.
1 KES = 0.00549 USD (when rounded to five decimal places)
So the KES/USD bid rate is 0.00549, or when you convert it to how many KES you need to buy one USD, you simply take the inverse:
- 1/0.00549 = 182.15 KES/USD
This is not one of the options provided, indicating a possible error in the options or a misunderstanding in the calculation method. Nevertheless, the closest option to our calculation is:
(d) 169.8