Question

The Channel Tunnel or​ "Chunnel" passes underneath the English Channel between Great Britain and​ France, a​ land-link between the Continent and the British Isles. One side is therefore an economy of British​ pounds, the other euros. If you were to check the​ Chunnel's rail ticket Internet rates you would find that they would be denominated in U.S. dollars​ (USD). For​ example, a first class round trip fare for a single adult from London to Paris via the Chunnel through Rail Europe may cost USD167.00.

This currency​ neutrality, however, means that customers on both ends of the Chunnel pay differing rates in their home currencies from day to day. What is the British pound and euro denominated prices for the USD167.00 round trip fare in local currency if purchased on the following dates at the accompanying spot rates drawn from the Financial Times​?

Date of Spot Rate	British Pound Spot Rate​ (£/$)	Euro Spot Rate ​(euro€​/$)
Monday	0.5653	0.8346
Tuesday	0.5758	0.8288
Wednesday	0.5736	0.8324

Answer 1

Let's start to understand the situation by taking Monday :-

As per the details British Pound spot rate to US Dollar is 0.5653 means to buy one British Pounds we have to pay 0.5653 US Dollars so the trip fare in local currency will be for Monday

In British Pounds =Fare in USD * spot rate of British pounds to US Dollars

=167 * 0.5653

=94.41 British Pounds

Similarly Fares in local currency for other days will be as below

Day	Fare in British Pounds	Fare in Euro
Monday	94.41	139.38
Tuesday	96.61	138.41
Wednesday	95.79	139.01