Calculating the Exchange Rate
" if 1 Canadian dollar is worth, say, $0.80 American, then how much is an American dollare worth in Canada? the answer is $1.25."
1 Canadian dollar (in units of foreign currency) = 1 / foreign currency (in Canadian dollars) ex. 1/0.8 = 1.25 (1 CAD = 1.25 USD)
1 unit of foreign (in Canadian dollars) = 1 / Canadian dollar (in foreign currency) ex. 1/1.25 = 0.80 (1 USD = 0.80 CAD)
1. John E. Sayre and Alan J. Morris, Principles of Macroeconomics (Toronto: McGraw-Hill Ryerson, 2009), 349