2006-10-09 18:16:34 · 4 answers · asked by whoo_kidd1 1 in Business & Finance ➔ Other - Business & Finance
Because the values of currencies are set by traders who base those values on what they think of a counrty's economy, political situation, both short-term and long-term prospects for growth, inflation rates, and other factors -- some of which are completely non-objective and have nothing to do with reality :) Within a country the exchange rates don't mean much -- they DO mean a lot for international trade, and for tourism.
Many years ago the British Pound and the US Dollar were trading at an equal value -- 1:1. That the pound is worth so much more now (basically now it takes two dollars to equal one pound) means that the international currency markets have more faith in the strength of Britain's economy than in the US.
2006-10-09 18:23:01 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Because of inflation. You can thank the people that took Silver & Gold out of our money for that. Inflation used to not exist. Because our money was based on something. Hope this helps.
2006-10-09 18:20:42 · answer #2 · answered by Jarod R 4 · 0⤊ 0⤋
It all depends on the exchange rate at the time of exchange
2006-10-09 18:24:37 · answer #3 · answered by moroaero 2 · 0⤊ 0⤋
Because http://xe.com/ says so. :)
2006-10-09 18:17:51 · answer #4 · answered by PJ 3 · 0⤊ 0⤋