EXCHANGE. 
<571 
Observation. — London gives the uncer- 
tain price to Genoa; that is, 46 pence ster- 
ling, more or less, for one pezza fuori di 
banco ; therefore, when London remits to 
Genoa, that place through which the lowest 
course of exchange can be obtained is to b ■ 
preferred, because less pence will be given in 
exchange for one pezza. O11 the contrary, 
when London lias to draw upon Genoa, that 
place should be chosen which furnishes the 
highest course, because more pence will Ire 
received in exchange for a pezza. 
If you include the charges in the oper- 
ation, insert, for an indirect remittance, 100 
less the charges in the divisor, and 100 in 
the dividend ; and, for an indirect draft, 
place 100 more the charges in the divisor, 
and 100 in the dividend. 
N. B. The above quotations are succes- 
sively combined in the following arbitrations 
to ascertain the advantage which may be de- 
rived from the comparison of the different 
proportional exchanges. 
London and Genoa through Amsterdam. 
A bill on Amsterdam taken in London at 
37 shillings 4 grotes Flemish banco per pound 
sterling is remitted to Genoa, and negotiat- 
ed at 84|- grotes Flemish banco per pezza of 
£-£ lire fuori di banco : what is the propor- 
tional exchange between London and Genoa ? 
1 pezza „ = 84-| grotes 
12 grotes — 1 shilling Flemish 
37|- shill. Flemish = 1 pound sterling 
1 pound sterling = 240 pence. 
Buie. — Multiply 20, fixed number, by the 
course of exchange between Genoa and Am- 
sterdam ; and divide the product by the 
course of London on Amsterdam. 
37f _ 20 
3 fraction 84| 
1 1 2 div. 1680 
17f 
1697$ 
3 fraction 
1 1 2)5092^(45 § result. 
London and Genoa through Hamburgh. 
A bill on Hamburgh taken in London at 
33 shillings 4 grotes Flemish banco per pound 
sterling is remitted to Genoa, and negotiated 
at 46f soldi fuori di banco per marc lubs 
banco : what is the proportional exchange be- 
tween London and Genoa ? 
1 pezza = 115 soldi 
46^ soldi — 1 marc banco 
3 marcs = 8 shillingsFlemish 
35|. shill. Flemish = 1 pound sterling 
1 pound sterling = 240 pence sterling. 
"Rule. — Divide 73600, fixed number, by 
the course of exchange between London and 
Hamburgh, multiplied by the course of Genoa 
on Hamburgh. 
35f 73600 
6 fraction 6 fraction 
212 9805)441600(45 result. 
46J 49400 
• 375 
1272 
£48 
53 
London and Genoa through Leghorn. 
A bill on Leghorn taken in London at 50 
pence sterling per pezza of 8 reals is remitted 
to Genoa, and negotiated at 124$ soldi fuori 
di banco per pezza of 8 reals: what is the 
proportional exchange between London and 
G enoa ? 
1 pezza fuori di banco = 1 15 soldi ditto 
124§ soldi ditto = 1 pezza of 8 reals 
1 pezza of 8 reals = 50 pence sterl. 
Buie. — Multiply 1 15, fixed number, by the 
course of exchange between London and 
Leghorn ; and divide the product by the 
course of Genoa on Leghorn. 
124| 115 
2 fraction 50 
249 div. 5750 
2 fraction 
249)1 1500(46^. result. 
1540 
46 
London and Genoa through Lisbon. 
A bill on Lisbon taken in London at 6l$ 
pence sterling per milreis is remitted to 
Genoa, and negotiated at 765 reis per pezza 
of 115 soldi fuori di banco: what is the pro- 
portional exchange between London and 
Genoa ? 
1 pezza = 765 reis 
1000 reis = 6l§ pence. 
Buie. — Multiply the course of exchange 
between Genoa and Lisbon by the course 
of London on Lisbon ; and divide the pro- 
duct by 1000, fixed number. 
765 
6ii 
765 
4590 
382-1 
1 ,000)47, 0474}(f-J_ result. 
London and Genoa through Madrid. 
A bill on Madrid taken in London at 34- 
pence sterling per dollar of exchange is re- 
mitted to Genoa, and negotiated at 660 ma- 
ravedis per gold crown : wluit is the propor- 
tional exchange between London and 
G enoa ? 
1 pezza v =11 5 soldi 
214 soldi = 1 gold crown 
1 gold crown = 660 maravedis 
272 maravedis — 1 dollar 
1 dollar = pence. 
(Rule. — Multiply 115, fixed number, by 
the course of exchange between Genoa and 
Madrid, and by the course of London on 
Madrid ; divide the product by 58208, fixed 
number. 
115 
660 
6900 
690 
75900 
303600 
227700 
56925 
58208)2637525(45-5- result, 
309205 
18165 
London and Genoa througliParis. 
A bill on Paris taken in London at 25 
livres 2 sols tournois per pound sterling is re- 
mitted to Genoa, and negotiated at 94-f sols 
m francs per pezza of 1 15 soldi fuori di banco : 
what is the proportional exchange betw een 
London and Genoa ? 
1 pezza = 94|- sols 
20 sols = 1 franc 
80 francs = 81 li res tournois 
25J- livres tournois = 1 pound sterling 
1 pound sterling = 240 pence sterling. 
Buie. — Multiply 243, ii xed number, by the 
course of exchange between Genoa and Paris ; 
and divide the product by 20, fixed number, 
multiplied by the course of London on 
Paris. 
20 
243 
94-i 
502 div. 972 
2187 
1214 
60 | 
30f 
502)23054f (454| result. 
2974 
464 
Becapitulation of the proportional exchange 
between London and Genoa. 
Through Amsterdam it comes out-at 45$ 
Hamburgh will answer to remit 45 
Leghorn - 46— 
Lisbonwill answer to draw 47-4- 
Madrid - 45 A- 
Paris - 4544 
1 t> 
Direct course between London and 
Genoa - - ' 46. 
Application to remit. — It appears by the 
comparison of the above-mentioned ex- 
changes, that the proportional exchange upon 
Hamburgh is the lowest, and consequently, 
that it would be more advantageous to remit 
to Genoa by that place, than by either of 
the others, or by a (lirect bill. Such remit- 
tance would establish an indirect course of 
45, instead of the direct 46 ; so that a mer- 
chant would give only 45 pence in exchange 
for one pezza fuori di banco. 
46 direct course : 45 indirect 
course :: 100/. - - 97 16 6 
Add for charges, at f per 
cent. * - - 0 15 0 
Advantage resulting from 
the arbitration - 1.86 
100 0 0 . 
Application to draw. — If a merchant at 
London had to value on Genoa, instead 
of drawing directly, be would order his cor- 
respondent at Genoa to take a bill on Lisbon 
at 765, and either to remit it thither to pro- 
vide for drafts from London upon Lisbon at 
61 3 , or to remit it to London to be negotiated 
at the same price. Such operation would 
establish an indirect course of 47^?_, instead 
of the direct 46 ; so that a merchant would 
receive 47J r pence in exchange for a pezza. 
46 direct course : 47-4-j- indirect 
course : : 100/. 1 - 102. 5 7 
Less for charges, at f 
per cent. . 0 15 0 
Advantage result ing from 
the arbitration 1 10 7 
9805 div. 
100 0 0 , 
