Answer :
The value of £135,500 is obtained in Option C) through a direct trade between the U.S. dollar and British pound at an exchange rate of $7.2 = £1.
If we assume that the exchange rate between the dollar and the pound is $7.2 = £1 when traded directly, and we are required to calculate the value of £100,000 in dollars, the solution will be:
£1 = $7.2
£100,000 = £1 × 100,000 = $7.2 × 100,000 = $720,000 (Multiplying both sides by £100,000)
$720,000 = £1 × X (£100,000)
(X is the value we need to determine)
$720,000 = X/7.2
(Dividing both sides by 7.2)
X = $720,000 × 7.2 = $5,184,000
(Multiplying both sides by 7.2)
Thus, if the U.S. dollar and British pound trade at $7.2 = £1 when traded directly, £100,000 is equal to $5,184,000.
In the given options, the amount closest to $5,184,000 is £135,500, which is option C.
Therefore, the correct option is C) £135,500.
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