15. Sending Money to Foreign Countries

I

Money may be sent to a foreign country by cable; by an international money order; by a foreign express order; or by a bank draft called a foreign bill of exchange.

Sending money by cable is the most expensive method, but often saves valuable time. An international money order may be purchased at any of the large post offices and is payable at the post office named in the order. A foreign express order, like other express orders, may be cashed in almost any foreign city where the person to whom it is sent can be identified. A foreign bill of exchange is also easily cashed at a bank, upon identification.

On all the three forms named above, the money is expressed in the currency of the country to which it is to be sent. For example, if $10 is to go to London, it would appear in the order as £2 1s. (see table below), or approximately that amount. The amount varies from time to time according to the rate of exchange, or the value in one country of the money of another country.

Using the table above, express in dollars and cents:

9. Make and solve other problems based upon the table above, or upon the table at the end of the book.

1 Lire is the plural of lira.

[Without pencil.]

10. Which of the coins in the table on page 163 are approximately equivalent to 20¢? To 25¢?

For ordinary quick figuring, we think of an English pound as equivalent to $5.00; of a shilling as 25¢; of a mark as 25¢; of a franc, a lira, or a peseta, as 20¢; of a peso or a ruble, as 50¢. Using these equivalents, give the approximate value of:

II. $25.00 in British money.

12. $1.50 in British money.

13. $2.75 in German money

14. 40¢ in French money.

15. $3.20 in Italian money. 16. $400 in Mexican money.

17. $100 in British, French, German, Mexican, and Italian money. 18. Make and solve ten other problems based on these approximate equivalents.

II

In forwarding money to foreign countries, current rates of exchange are consulted. These are published in newspapers in large cities.

The variation in the rates of exchange is due to the relative demand for money in the different countries. If there is plenty of money to carry on the business of the country, money in that country will be cheap, and its rate of exchange "at par" or "below par"; if more money is needed than is at the time available, money will be "high," and its rate of exchange "above par."

English exchange is quoted as dollars to the pound sterling. £100 @ 4.87 means that £1 is worth $4.87, and £100 is equivalent to $487.00.

French exchange is quoted as the number of francs that can be purchased for $1. Thus 5.143 shows that 5.143 francs will cost $1.

German exchange is quoted as the number of cents that 4 marks will cost. Thus, 95 shows that 4 marks will cost 95.

15. Jean Hugo sent from St. Louis to his father in Paris a bank draft for 75 fr. With exchange at 5.44, how much did it cost?

16. Mr. Tyler sent to London for a book that was listed at £2. How much did he pay for the express order with exchange at 4.20 and the fee for the order, 5¢?

17. Bernard Reimich sent his sister in Germany an express order for 120 M. With exchange at 136, how much did the express order cost him, including a fee of 12¢?

18. Domenico sent to his family in Florence, Italy, for Christmas, a money order for $9.70. If the lira was worth 19.4¢, how many lire did the family receive when they cashed the money order?

*19. How much is $25 worth in British money with exchange at 4.85? In French money, at 5.15? In German money, at 951/?

*20. Since the great European war, our exchange rates with European countries have been abnormally low. Consult newspapers for current rates of exchange and find the present value in United States money of the pound sterling. Of the franc. Of the lira.

1 There are 20 shillings in a pound sterling. Hence, 6s = £2%, and £3 6s = £32% or £31.

1. In the above table what per cent of the 100 men were in good or moderate circumstances or self-supporting at 35 years of age? At 45? At 55? At 65? At 75?

2. At 45 years of age, what per cent of those living were in good circumstances or self-supporting? At 55 years? At 65?

3. Make and solve three other problems based on the table. 1 Compiled by the American Banker's Association.

The following table shows the results from systematic savings deposited each month in a Savings Bank that adds interest at 4% every 6 months.

4. A boy deposited $2 a month. In 6 years he had in the bank

5. A girl deposited $3 a month for 10 years. She then had $—. 6. Make two other similar statements.

17. Good and Bad Investments 1

I. "SAFETY FIRST" IN INVESTMENTS

Every person should not only try to save some of his earnings, but also learn how to invest his savings wisely. Millions of hardearned dollars are lost each year through foolish investments. The newspapers and mails bring to our attention numerous offers of investment. Some of them are honest and reliable, but many either are frauds or are too unsafe to be considered by the wise investor. "Safety first" should apply to all investments. Usually, the higher the rate of income offered by an investment, the greater is the risk of losing the money invested.

II. SAFETY OF BANKS

[With pencil.]

1. In a recent year, out of a total of 25,000 banks in the United States, 79 failed. What per cent failed?