2. There are $100 payable one year hence, and $106 to be paid six years hence; what is the equated time, computing interest at 6 per cent.?

Ans.

3. A debt of $1000 is to be paid, one half in three years and the other half in 6 years; what is the equated time for paying both, computing interest at 7 per cent?

Ans.

EXCHANGE.

THE object of Exchange is to ascertain what sum of money ought to be paid in one country for a sum of different denominations or of different relative value received in another, according to the course of exchange.

The par of exchange respects the intrinsic value of the money of different countries compared with each other. Thus a pound sterling is equal to 4 dolls. and 44 cents in the United States; the mark banco of Hamburgh, to 331 cents; 40 marks banco to £3 sterling. If the exchange be made at the intrinsic value of the money of different countries, it is said to be at par; but if the money of one country be estimated, at less or more than its intrinsic value, the exchange is said to be above par, or below

par.*

Owing to changes in the course of trade, to demand for money, to variations in the relative value of gold and silver, &c. the relative value of the money of two countries is liable to frequent changes. Hence the course of exchange, or the current price of exchange, must vary with these circumstances, and be sometimes above, and sometimes below, par. Tables of the course of exchange are published daily in the great commercial cities.

The Rules under Reduction of Coins are founded on the par of exchange, For the reduction of the Money, and Measures of most commercial countries to Federal and Sterling Money, and American Measures, see also the Tables of Money, Length, Capacity and Weight.

1. OF GREAT BRITAIN.*

The denominations are pounds, shillings, and pence.

EXAMPLES.

1. What is the amount in Federal Money of a Bill of Exchange on a merchant at Liverpool of £133 sterling, sold in New York at per cent. advance ?

£ $ c. 133-591-111

2.9510 per cent.

Amount $594-063 Ans.

2. In Aug. 1821, Bills on London, bore at Boston a premium of 8 per cent.; what is the amount of a bill of exchange of £250, at this rate, in Federal Money, and what is the value of a pound sterling at this course of exchange? Ans. Amount $1205 55 cts. Value of a pound sterling $4 823cts. 3. A Bill of Exchange on London of £90 sterling, was sold at New York, at 36 shillings New York currency per pound sterling; what was its amount in the currency of New York, and how much above or below par r?

£ S. £ £

As 1 : 36: 90: 162 N. Y. currency.

Now £9 sterling=£16 N. Y. currency, or 20s. sterling=35 N. Y. currency. But 36-355-3s. N. Y. currency, the gain on every pound sterling, or £2 N. Y. in the whole.

Then, as 355s.: :: 100: 14 per cent. above par.

Or, 162-2: 2 :: 100 : 14 do.

4. The invoice of goods, amounting to £170 10s. sterling, is sold at New York at 25 per cent. advance; what is the amount in Federal Money?

Ans.

The Rules on which the operations of Exchange are performed, are obvi-` pus from the rules for Reduction of Coins, and the Rule of Three.

+ To reduce sterling money to the currency of New England, when there is a cortain per cent. advance, merchants use the following method. For 12 per cent. advance, multiply the sterling by 1

20

13

13

12

21

100

125

150

34

175 200

These multipliers are thus formed. Let the advance be 25 per cent. on £100;

then, as 25 of a hundred, 100x

100 500
4 4

2000

is to be reduced to New England currency by increasing it by one third of itself. 500 500 Thus X ~=1663 pounds; which is evidently the same as to mul 4 3X4 12 tiply 100 by 13. In the same way may the other multipliers be found.

5. A Bill of Exchange of £75 16s. is sold at Boston at 26s. New England currency per pound sterling; what is the value in Federal Money of a pound sterling at this rate of exchange? Ans.

2. OF FRANCE.

The money of account is

12 deniers make

20 sols

The livre is estimated at 18

livres, sols, and deniers.
1 sol or shilling.

1 livre or pound.

cents in the U. S.

The crown of exchange is 3 livres, or livres tournois, and is equal to 55 cents.

The present money of account is francs and centimes or hundredths. 80 francs 81 livres, or à franc

livre.

1. To reduce francs to livres, or the contrary, multiply the francs by 81 and divide the product by 80 for livres; or multiply the livres by 80 and divide the product by 81 for francs.

Thus 2156 francs=

2156 × 81

2341 × 80

livres

81

=2312 francs, 0911 centimes.

2. To reduce livres to dollars and cents; multiply the livres by the cents in a livre at the course of exchange.

EXAMPLES.

1. If the livre be 20 cents in exchange, what is the amount of 2150 livres in Federal money, and what is the per cent. above par at this exchange?

Ans. Amount is $430. And above par 8 per cent. 2. If the livre be 18 cents in exchange, required the amount of 3580 livres 16 sols, in dolls. and cents, and the rate per cent. below par.

Ans. 644.54 cents, and 24 per cent. below par. 3. If a crown be valued in exchange at 18d. sterling, required the livres in £100 sterling, and the amount also in Federal money d. liv. £ liv.

at par.

As 3 livres 1 crown, 18: 3 :: 100: 4000 and 4000×181 $740. 4. In 2583 francs, how many dollars?

2583×551=1433dolls. 564 cents. 5. A bill of exchange on a merchant in New York of $730 65cts. was bought at Paris at 11 per cent. advance; what is the amount in francs, and what was the estimated value of a franc at this exchange?

Ans.

Hard or plate dollars are 88 per cent. above current dollars or

money of vellon, or

The rial plate is 10 cents, and the rial vellon 5 cents in the U. States.

To reduce rials plate to rials vellon, or the contrary, multiply the rials plate by 32 and divide the product by 17, for rials vellon ; or multiply the rials vellon by 17 and divide the product by 32, for rials plate.

1. Thus 1100 rials plate=

1100 × 32

17

rials vellon 207019 Ans.

rials plate=531 rials plate. Ans.

Note. The rules to reduce rials plate or vellon to Federal Money are obvious and need no examples.

2. In the sale of a bill of exchange of 1563 rials plate, the rial plate was estimated at 95 cents; how much per cent. was the rial below par and how much the loss?

Ans 44 per cent.

$6.943 the loss. 3. If the piastre be valued in exchange at 81 cents, what is the per cent. above par on a bill of 1672 piastres 5 rials plate, and what is the advance on the bill in Federal Money?

4. OF HAMBURGH.

Aus.

12 deniers 2 grotes make 1 shilling lubs, or stiver.
16 shilling lubs=32 grotes 1 mark banco.*

Or, 12 grotes or pence Flemish make 1 shilling Flemish.

20 shillings Fl.=74 marks

1 pound Flemish. A mark is of a dollar, or 331 cents in the U. States, and the Rix dollar is equal to the Spanish dollar, or 100 cents. The mark is 23 shillings Flemish.

The Bank money of Hamburgh is superior to the currency at a variable rate per cent.

1. To reduce marks banco to dollars, divide the marks by 3.

3437
3

Thus 3437 marks= dolls. $1145 663cts.

2. To reduce pounds Flemish to dollars, multiply the pounds by 5, and divide the product by 2 for dollars. Thus, to reduce 175 175.5X5

pounds Fl. and 10 shillings to dollars,

2

dolls. $438-75cts.

3. To reduce Hamburgh money to sterling, use the following proportion; As, the value of a pound sterling at Hamburgh is to 1 pound, so is the Hamburgh sum to the sterling required.

1. When the pound sterling is 33 shillings Flemish, what is the value of £1567 10s. Fl. in sterling money?

S. £ £ FI. £ sterling.

As 33 1: 1567·5: 950

* Banco is money placed in banks of deposit, and is not to be drawn out, but is transferred from one person to another for the payment of contracts.

2. Reduce 2560 marks 8 stivers to sterling, at the rate of 334 shillings Fl. per pound sterling. Aas. £204 16.9-6d. sterling. 3. When the pound sterling is 34 shillings Flemish, what is the per cent. below par? Ans. 43 per cent.

4. To reduce current to Bank money, use the following propor. tion. As 100 marks with the rate added is to 100 bank money, so is current sum to the bank money required.

1. Reduce 360 marks current to bank money, when rate or agio is 20 per cent.

As 100+20: 100 :: 360: 300 bank money, Ans.

2. When the rate or agio is 18 per cent. what is the value of 3759 marks 8 stivers current in bank money? Ans.

3. If 375 marks current are estimated at 320 marks bank, what is the rate per cent ? Ans.

The Bengal rupee is estimated at 50 cents in the United States; in exchange it is usually 3 or 4 cents less.

100 sicca rupees are equal to 116 current rupees.

1. Reduce 187 rupees 8 annas to federal money at 46 cents per rupee. Ans. $89 061 cents. 2. Reduce $367 to rupees, the rupee being valued at 48 cents, Ans. 763 rupees, 15 annas, and 4 pice. Note. From the exchange value of the money of different countries, and from the Table of Money of commercial countries, immediately before the "Chronological Problems," the student will be able to derive particular rules for making all the exchanges of

money, which may be necessary in business.

POLICIES OF INSURANCE.

INSURANCE is an assurance or security by a contract, to indemnify, for a specified sum, the insured for such losses as the property may be exposed to, for a certain time.

The insurer or underwriter, is the party that is bound to indemnify for the loss sustained.

The premium is the compensation paid by the insured for the

insurance.

The policy is the document by which the contract of insurance is made.

Goods are said to be covered, when their value and the premium and other charges are insured.

If the loss do not exceed five per cent. the underwriter is free, and the loss is borne by the insured. Particular average, is the proportioning of such losses as arise from ordinary accidents at sea,