Question

Upon returning home from your Cancun vacation you still have 2,000 MXN in your wallet. Again at the airport you stop by the TravelEx office to convert these back into dollars. Today Travelex is quoting the MXN at 21.50 Ask and 20.00 Bid. How many USD will you receive if you exchange your pesos back into dollars?

Answer 1

To exchange 2,000 MXN into USD at a bid price of 20.00 MXN/USD, you will receive 100 USD.

Step-by-step explanation:

When you want to exchange your pesos back into dollars, you use the 'bid' price that Travelex offers for buying pesos from you. In this case, Travelex has a bid price of 20.00 MXN/USD. To find out how much money you'll receive in USD, you divide the amount of pesos you have by the bid price.

With 2,000 MXN and a bid price of 20.00 MXN/USD, you would get:

2000 MXN ÷ 20.00 MXN/USD = 100 USD.

Therefore, if you exchange 2,000 MXN at the bid price of 20.00 MXN/USD, you will receive 100 USD.