Question

During the Bretton Woods Period the dollar was pegged to the gold at $35/oz. The German mark was pegged to the dollar at DM10/$. If the price of gold in pounds was £17.5/oz. What was the exchange rate between the German mark and the british pound?

Answer 1

Answer: 20 DM/GBP

Step-by-step explanation:

The exchange rate is determined by following conversion:

`x = ((10 DM)/(1 USD))\cdot ((35 USD)/(1 oz)) \cdot ((1 oz)/(17.5 GBP) ) \\x = 20 (DM)/(GBP)`