Why do we need to calculate rand dollar exchange rate?


Expert Answers

An illustration of the letter 'A' in a speech bubbles

The only two reasons to calculate (or to find out) the exchange rate between the dollar and the rand are:

  • You are South African and you want to travel to or buy something from the US.
  • You are from the US and you want to travel to or buy something from South Africa.

Whenever a person (or firm) from one country wishes to buy from another country, they must first obtain some of that other country's money.  When they do this, the exchange rate matters.

So let's say an American travel company wants to offer packages for attending the World Cup next month.  They must buy tickets from South Africa.  In order to do that, they need to exchange dollars for rand.

See eNotes Ad-Free

Start your 48-hour free trial to get access to more than 30,000 additional guides and more than 350,000 Homework Help questions answered by our experts.

Get 48 Hours Free Access
Approved by eNotes Editorial