ARITHMETIC.
S4'0
S-. 6d. are the different selling prices of the same quantity and110/. and 133/. I Is. bid being proportional to them are the dilferentselling prices of a quantity which cost 100/.
Exchange.
(61.) By exchange is mpant the bartering or exchanging of themoney of"one place for that of another, and, like the bartering ofwares, it commonly consists in finding what quantity of the mo-nev of one place will be equal to a given sum of another, accord-ins; to a given course of exchange.
By course of exchange is meant the variable sum of the moneyof one place which is proposed to be given for a constant piece orsum of that of another, to serve for tiifc present, as a rate or pro-portion bv which to exchange other sums; and it is sometimesabove anti sometimes below the par.
Bv the par of exchange is meant an intrinsic equality betweentwo pieces or sums of money, one of w hich is the constant pieceor sum to which the course is compared. 'The money in the banksof foreign places is finer or purer than that which is current inthem ; and the difference between any sum, as valued in the one,and its value in the other, is called agio.
It is by comparing the bank money with ours, that the par isascertained. The exchange is always supposed to be made inbank money ; and if there be a necessity for taking currency incase of a defect of the bank to'answer the bills, the more of itmust be received, and that in proportion to the agio.
1. With Ireland, America , and the West Indies.
(62.) Accounts are kept in Ireland, America, and the West In-dies , in pounds, shillings, and pence, as in England ; and the ex-change per cent, sterling; the par being 1 OS/, tit. 8 d. Irish per100/. sterling, or 1/. l.t. 8 d. per pound: also 5/. sterling is ac-counted worth 7/. of the currency of the West Indies , because,of the great plenty of foreign coins there.
II. With Holland, Flanders, and Germany .
(63) In these places accounts are kept in pounds, shillings andpence, as in England ; and sometimes in guilders, stivers and pen-nings. The money of Holland and Flanders is distinguiseed bythe epithet Flemish, and they exchange by the pound sterling, thepar being 33s. 4 d Flemish per pound sterling.
' 1. In Holland and Flanders.
16 pennings make 1 stiver.
20 stivers or 40 pence—1 guilder or florin.
8 pennings—1 grote or penny.
12 grotes or pence—1 skilling.
20 skillings—1 pound.
12 pennings—1 shilling lubs.
16 lubbish shillings—1 mark.
6 uennings—1 grote Hem.
6 lubbishshili. — 1 skill, flem.
7[ marks lubs—1 pound flem.
(64.) In France , accounts are kept in livres. sols and deniers;exchange being made by the French crown, the par of which is2s. 6d. sterling, or 2s. bid. more nearly.
12 deniers—a sol or sou, value . 0 0-J
20 sols a livre . 0 9J
3 livres—a crown or ecu. 2 5y •
(65.) In Spain they keep their accounts in piastres, rials, amimervadies ; reckoning 372 ntervadies to a rial, and 8 rials to apiastre, by which they exchange, anil its par is 4s. Od. sterling.
- (66.) In Genoa and Leghorn they keep their accounts in livres,sols and deniers, as in France , but exchange by the piastre, as inSpain, which in Genoa is accounted 5 livres, and at Leghorn 6 .At Venice too, accounts are by some kept in die same manner,and by others in ducats and gross, reckoning 24 gross to a ducat,upon which they exchange, and its par is accounted 4s. id. ster-ling.
(67.) In Portugal accounts are kept in milreas and reas, reckon-ing 1000 reas toamilrea.as its name imports ; and they exchangeby the milrea, the par of which is about 6s. 3\d. orbs. <Jt/. sterl.
(68.) General Rules shewing on what manner compulations re-specting the comparison of monies are to be made.
1. Reduce the given sum, (if necessary) to that kind of moneyby which exchange is computed.
2. Reduce this, according to the given rate of exchange, intothe corresponding money ot the oilier country.
3. Reduce the exchange of money thus found (if necessary) tothe kind of money required.
Examples.
1. How much sterling money in 5476 guilders current exchange36s. 3d. Flemish per pound sterling agio 24 percent.
102.5 : 100 : : 5476
100 G. Ban.
102.5)547600(5342.4
40
d. - L. s. d.
36s. 3d.=435)215696.0(491 5 6
Here agreeably to the first of the preceding general rnles we re-duce*347t) guilders current, to 5342.4 Banco by the proportion of1024 to 100, this again is brought to pence flemish, by multiply-ing by 40 the pence in a guilder, and 30.y. 3f?. or 435(1. tlemish isworth 1/. sterling: therefore divide by 435, and the quotient491/. 5s. 6(/. is the sterling money required.
2. liow many current guilders in 190/. sterling cx, 34s. 8 d.llcm. per L. sterling, agio 2 per cent.
S. D.
. : d. flem. L.
34 8
: 416 : : 100
12
100
416
41600 d. flem. Banco .100 : 102 : : 41600
102
83.00
410000
100)4243200
. 40)42432d.
current.
1060 guil. 16 stivers.
Arbitration oe
Exchanges.
(69,)!As the course or rate of exchange between one nation andanother is almost continually varying, either by rising or falling,from the variations in the circumstances and balance ot trade : sothe design of arbitration is to remit or draw upon foreign placesin such a manner, as shall turn out the most profitable.
Arbitration is generally divided into two parts, Simple andCompound.
1. Simple Artiitr ation.
(70.) In simple arbitration, the exchanges among three placesonly are concerned. The par of arbitration, or arbitration[n ice, is such a rate of exchange between two places, as shall hein proportion with the rates assigned between each of them and athird place. After this par of arbitration is computed, by com-paring it w ith the present course of exchange, a person can judgew hicli w ay to remit or draw to the most advantage, and determinevvluit the advantage shall he.
F.x. 'I’he exchange between London and Amsterdam being33s. 9d. per pound sterling, and the exchange between London and Paris, 3‘Jd. per crow n ; the par of arbitration between Am-sterdam and Paris is required.
Answer. Bv reduction 11. slcrl. = 240d. sterl. and 33y. 9d-flem. = 405d. llem.
d. ster. d.flem. d. ster. d. flem.
Then 240 : 4u5 : : 32 : 54
The par of arbitration therefore, between Amsterdam and Paris , is54d. flem. per crown.
2. Com-