Question

You get a bid-ask quote on the AUD of 1.31-1.36 USD/AUD. How many AUD will you be able to buy with 100 USD?

Answer 1

USD - US dollar

AUD - Australian Dollar

Bid-ask quote is A two-way price comprises a bid, or the price at which a dealer is willing to buy, and an ask (or offer) at which a dealer is willing to sell.

The bid is always lower than the ask, or offer, and is always quoted first.

Keep in mind, here we are talking about the dealer. The scenario would be opposite if you want to buy or sell. Dealers bid is your ask or you have to sell at the price dealer is willing to buy and dealer's ask is your bid. You have to buy at the rate dealer is willing to sell.

The ask is 1.36 USD/AUD. This means you can buy one 1.36 USD for 1 AUD.

Therefore 1 USD = 1/1.36 AUD

= 0.7353 AUD

Similarly For 100 USD = 73.53 AUD

For 100 USD you can buy 73.53 AUD.