Question

An international bank issues its Traveler credit cards worldwide. When a customer makes a purchase using a Traveler card in currency different from the customer's home currency, the bank converts the purchase price at the daily foreign exchange rate and then charges a $4$% fee on the converted cost.
Sara lives in the United States, but is on vacation in India. She used her Traveler card for a purchase that cost $602$ rupees (Indian currency). The bank posted a charge 9.88$toheraccountthatincludedthe$4$% fee.
What foreign exchange rate, in Indian rupee per one U.S dollar, did the bank use for Sara's charge? Round your answer to the nearest whole number.

Answer 1

Cost of the item $=602$ INR

Conversion fee $=4\%$

Total bank charges $=9.88$ USD

The bank charges includes conversion rate and $4\%$ conversion fee.

Let the conversion rate (in USD) be $x$.

$\therefore 9.88=x+0.04x$

$\therefore x=\frac{9.88}{1.04}=9.5$ USD

The cost paid by the customer is INR $602$ and its value in USD is $9.5$.

Hence, the conversion rate is $=\frac{602}{9.5}=63.36$

Therefore, we can say that $1$ USD $=63$ INR