sum by, because 6s., or a dollar in this currency, is of a pound. Hence the

RULE. · Divide the given sum expressed in pounds and decimals of a pound, by the value of $ 1 expressed in a fraction of a pound. The quotient will be the value in dollars.

EXAMPLES FOR PRACTICE.

Ans. $344.

2. Change 144£ 7s. 6d. of the old New England currency to United States money. Ans. $481.25. 3. Change 74£ 1s. 6d. of the old currency of New York to United States money. Ans. $185.182. 4. Change 129£ of the old currency of Pennsylvania to United States money. 5. Change 84£ of the old currency of South Carolina to United States money. 6. Change 144£ 4s. of Canada and Nova Scotia currency to United States money. Ans. $576.80. 7. Change 257£ 8s. 6d. English or sterling money to United States money. Ans. $1245.937.

Ans. $360.

259. To reduce United States money to old State currencies.

Ex. 1. Reduce $152.625 to old New England currency.

OPERATION.

152.625 X 1 = 45.7875£. 45.7875£= 45£ 15s. 9d.

Ans. 45£ 15s. 9d.

Since 6s., or a dollar, in this currency, is of a pound, we multiply the given sum by a fraction, and reduce the decimal to shillings and pence. (Art. 189.)

RULE. Multiply the given sum expressed in dollars by the value of $1 expressed in a fraction of a pound. The product will be the value in pounds.

EXAMPLES FOR PRACTICE.

2. Change $481.25 to the old currency of New England. Ans. 144£ 7s. 6d.

259. How do you reduce United States money to pounds, shillings, pence, and farthings, New England currency? Why multiply by 3⁄4£ ? How would you reduce United States money to pounds, &c., Ohio carrency? How to Pennsylvania currency? The general rule? The rule for reducing United States money to pounds, shillings, pence, and farthings, of the different currencies ?

3. Change $185.18 to the old currency of New York. Ans. 74£ 1s. 6d.

4. Change $344 to the old currency of Pennsylvania.

Ans. 129£.

5. Change $360 to the old currency of South Carolina.

Ans. 84£.

6. Change $576.50 to Canada and Nova Scotia currency.

Ans. 144£ 2s. 6d.

7. Change $1245.937 to English or sterling money.

Ans. 257£ 8s. 6d.

260. To reduce any foreign currency to United States money, and United States money to any foreign currency, when the value of a unit of the currency is known (Art. 256).

Multiply or divide, as the case may require, by the value of the unit of the given currency expressed in United States money.

EXAMPLES FOR PRACTICE.

Ex. 1. Reduce 123 rubles, silver, of Russia, to United States money.

2. Reduce $27.90 to francs.

Ans. $92.25. Ans. 150 francs.

3. What is the value of 121 thalers of Prussia in United

States money?

4. What is the value of $165.20 in florins?

Ans. $83.49.

Ans. 413 florins.

5. A merchant purchased tea in China to the amount of 216 taels. What did it cost in United States money?

Ans. $319.68.

6. How many reals, plate of Spain, are equal to $5137.90? Ans. 51379.

EXCHANGE.

261. Exchange, in commerce, is the paying or receiving of money in one place for an equivalent sum in another, by means of Drafts or Bills of Exchange.

260. How do you reduce any foreign currency to United States money, and United States money to any foreign currency?- -261. What is exchange?

A Bill of Exchange is a written order, to some person at a distance, to pay a certain sum, at an appointed time, to another person, or to his order.

The Maker or Drawer of a bill is the person who draws it.

The Buyer, Taker, or Remitter of a bill is the person for whom it is drawn.

The Drawee is the person on whom it is drawn; who is also called the acceptor, after he has accepted it.

The Indorser of a bill is the person who indorses it.

The Holder or Possessor of a bill is the person in whose legal possession the bill may be at any time.

Exchange is at par when a certain sum, at the place from which it is remitted, will pay an equal sum at the place to which it is remitted.

It is said to be at a premium, or above par, when the balance of trade is against the place from which the bill is remitted; and below par when the balance of trade is in favor of the place from which the bill is remitted.

INLAND BILLS.

262. An Inland Bill of Exchange, or Draft, is one of which the drawer and drawee are both residents of the same country.

263. To find the cost of an inland bill, or draft.

Add to the face of the bill, or draft, the amount of premium, or subtract from the face of the bill, or draft, the amount of discount.

EXAMPLES FOR PRACTICE.

Ex. 1. What is the cost of the following bill of exchange, or draft, at 14 per cent. discount? Ans. $445.22.

$ 452.

Boston, March 6, 1856.

At sight, pay to William Dura, or order, four hundred and fifty-two dollars, value received, and charge the same to my acEDWIN DANTON.

count.

To LEWIS FONTENAY,

Merchant, New Orleans.

2. A merchant in Chicago purchased a bill on New York for $1164, at 1 per cent. premium; what did he pay?

261. What is a bill of exchange? Who is the maker, or drawer, of a bill? The buyer, taker, or remitter? The drawee? The indorser? The holder, or possessor? When is exchange at par? When at a premium ? When at a discount?-262. What is an inland bill, or draft? 263. How do you find the value of an inland bill, or draft?

3. What costs a bill on Burlington, Iowa, for $4000, at 24 per cent. discount? Ans. $3900. 4. What costs a bill on Buffalo for $ 450, at of 1 per cent. discount? Ans. $447.182.

5. What costs a draft from the Girard Bank, Philadelphia, on the Bank of Commerce, Boston, for $2517.70, at of 1 per cent. premium? Ans. $2520.84+.

FOREIGN BILLS.

264. A Foreign Bill of Exchange is one of which the drawer and drawee are residents of different countries.

Foreign bills are usually drawn in sets; that is, at the same time there are drawn two or more bills of the same tenor and date, each containing a condition that it shall continue payable only while the others remain unpaid.

NOTE. -Each bill of a set is remitted in a different manner, in order to guard against loss or delay; and when one of the set has been accepted and paid, the others become worthless.

EXCHANGE ON ENGLAND.

265. The exchange value in the United States of the pound sterling of Great Britain, is that of its former legal value, $ 43 $40 $4.443. The commercial value is generally about 9 per cent. more than this exchange, or nominal par value.

=

Therefore, when the nominal exchange between the United States and Great Britain exceeds 9 per cent. premium, it is above commercial par; when less, it is below that par.

NOTE.

- The intrinsic or mint value of a pound sterling according to the pure metal in an English sovereign, is $4.861, so that sterling money is actual par when it is quoted at 9 per cent. premium.

266. To find the cost of a bill on England.

Ex. 1. What should be paid for the following bill at 9 per cent. premium? Ans. $4866.66.

264. What is a foreign bill of exchange? How are foreign bills usually drawn? Why?-265. What is the exchange value of the pound sterling of Great Britain, in United States money? How does this differ from the commercial par value?

Exchange for £1000.

New York, May 16, 1856.

Thirty days after sight of this first of exchange (second and third of the same tenor and date unpaid), pay J. W. Hathaway & Co., or order, London, one thousand pounds sterling, value received, and place the same to my account.

TO BATES, BARING, & Co., London.

OPERATION.

RUFUS W. KING.

$ 1.095 $4.8663; 1000 × 4.8663 = $ 4866.66.

We multiply $40, the nominal value of a pound, by 1.095, the given rate, decimally expressed, and obtain $4.866 as the cost of a pound at that rate; and 1000 multiplied by the number denoting this cost gives $ 4866.663 as the cost of the bill.

RULE.

Multiply the face of the bill by the cost of one pound at the given rate of exchange, and the product will be the cost in dollars.

-

NOTE. When there are in the given sum, shillings, pence, or farthings, they must be reduced to a decimal of a pound.

EXAMPLES FOR PRACTICE.

2. A merchant in Boston wishes to purchase a bill of 572£ 10s., on Liverpool, the premium being 8 per cent.; what will it cost him in dollars and cents? Ans. $2760.728.

3. If J. C. Sherman, of Chicago, should 1200£, exchange being at 94 per cent., what the bill in United States money?

remit to London will be the cost of Ans. $5826.66.

267. To find the face of a bill on England, which can be purchased for a given sum.

Ex. 1. When exchange is at 9 per cent. premium, what will be the amount of a bill on London which I can purchase for $4866.66? Ans. 1000£.

OPERATION.

$41.095 $4.8663; 4866.663 4.8663 = 1000£.

=

266. The rule for finding the cost of a bill on England in United States currency? 267. The rule for finding the face of a bill on England, which can be purchased for a given sum of United States currency?