Currencies in use vary from country to country, based on the accepted medium of exchange in that country. For example, pounds are used in the United Kingdom and dollars are used in the United States. The value of currencies change daily based on the strength of the market to which the individual currencies are tied; however, anyone can use a simple formula to determine the value of one currency according to another currency. This will work whether one is converting pounds into dollars, dollars into pounds or any other world currency.
Look up the current exchange rate using an online resource (see Resources). Exchange rates change minute to minute and both the British and American economies can affect the strength of either the dollar or the pound. Therefore, it is important to have the most up-to-date information. This will represent "x" in the equation.
Count the number of pounds in your possession. This will represent "y" in the equation.
Multiply the amount of pounds in your possession with the exchange rate according to the following formula: xy = z. The result, "z", is the amount of money you have in dollars.
You can reverse the formula by dividing the amount of dollars you receive in a transaction by the original number of pounds in order to determine the exchange rate: z/y = x.
Tips and warnings
- You can reverse the formula by dividing the amount of dollars you receive in a transaction by the original number of pounds in order to determine the exchange rate: z/y = x.