Find Out How To Calculate Exchange Rates Yourself
When looking at exchange rates, there are two key terms to be aware of: Consumption Basket. When you hear this in relation to a country, it purports to the goods and services that are purchased or consumed by the average person in that country. Real Exchange Rate. This uses a nominal exchange rate and a ratio of prices for the shopping baskets of two countries. The real exchange rate will compare the prices of two consumption baskets in the relative currencies....