Question

Mr Anil bought some American dollars for Rs 540000 at the exchange rate of 1$=Rs 120 to visit USA. Unfortunately, because of his Visa Problem, he cancelled his trip. Within a week Nepali rupee is devaluated by 5%.He again exchanged his dollars to Nepali rupee after a week. a) How many dollars did he get with Rs 540000? b) What is the new exchange rate after devaluation in Nepali rupee? c) How much did he gain or lose? d) After devaluation of Nepali rupee, if the bank took 2% commission, how many rupee would he gain or lose?

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Answer 1

Answer: a) To find out how many dollars Mr Anil got with Rs 540,000, we'll divide the amount in Nepali rupees by the exchange rate.

• Exchange rate: 1$ = Rs 120
• Amount in Nepali rupees: Rs 540,000

• Number of dollars = Amount in Nepali rupees / Exchange rate
• Number of dollars = 540,000 / 120
• Number of dollars = 4,500

Therefore, Mr Anil got 4,500 dollars with Rs 540,000.

b) After the devaluation of the Nepali rupee by 5%, the new exchange rate would be 5% less than the previous rate.

New exchange rate = Previous exchange rate - (Previous exchange rate * 5%)

• New exchange rate = 120 - (120 * 0.05)
• New exchange rate = 120 - 6
• New exchange rate = 114

The new exchange rate after the devaluation is 1$ = Rs 114.

c) To calculate how much Mr Anil gained or lost, we need to compare the initial exchange rate with the new exchange rate.

• Initial exchange rate: 1$ = Rs 120
• New exchange rate: 1$ = Rs 114

Gained or lost = Number of dollars * (New exchange rate - Initial exchange rate)

• Gained or lost = 4,500 * (114 - 120)
• Gained or lost = 4,500 * (-6)
• Gained or lost = -27,000

Mr Anil lost 27,000 rupees due to the devaluation of the Nepali rupee.

d) If the bank took a 2% commission on the transaction, we need to calculate the commission amount and adjust the gain or loss accordingly.

• Commission amount = Number of dollars * (Commission rate)
• Commission amount = 4,500 * (0.02)
• Commission amount = 90

• Adjusted gain or loss = Gained or lost - Commission amount
• Adjusted gain or loss = -27,000 - 90
• Adjusted gain or loss = -27,090

After the devaluation of the Nepali rupee and considering the 2% commission, Mr Anil would lose 27,090 rupees.

Answer 2

Mr. Anil received 4500 dollars for Rs 540000. After devaluation and reconversion without commission, he gained Rs 27000. With a 2% bank commission, his gain would be reduced to Rs 15660.

Step-by-step explanation:

Mr. Anil initially exchanged Rs 540000 at a rate of 1$ = Rs 120, so he received 4500 dollars. After Nepali rupee devaluation by 5%, the new exchange rate would be Rs 126 for 1$ (5% of 120 is 6; 120 + 6 = 126). When Mr. Anil exchanged his 4500 dollars back to Nepali rupees at the new exchange rate, he would receive Rs 567000 (4500 dollars * Rs 126), gaining Rs 27000 (Rs 567000 - Rs 540000).

If the bank took a 2% commission on the transaction after devaluation, the commission would be Rs 11340 (2% of Rs 567000). After deducting the commission, Mr. Anil would receive Rs 555660 (Rs 567000 - Rs 11340), gaining Rs 15660 (Rs 555660 - Rs 540000).