If the United Kingdom buys gold for $60 an ounce and Nigeria buys the same ounce for ₦500, what will be United Kingdom's exchange rate with Nigeria?

To calculate the exchange rate, we need to convert the cost of an ounce of gold in both currencies to a common currency. Let's choose the US dollar as our common currency. From the information given in the question, we know that: 1 ounce of gold = $60 (in the UK) 1 ounce of gold = ₦500 (in Nigeria) We need to convert the Nigerian Naira to US dollars to make a comparison. Let's assume that the exchange rate is X Naira per dollar. Therefore: 1 ounce of gold = $60 (in the UK) 1 ounce of gold = (₦500/X) dollars (in Nigeria) To find the exchange rate, we can equate the two expressions for the cost of 1 ounce of gold: $60 = ₦500/X Multiplying both sides by X, we get: $60 X = ₦500 Dividing both sides by ₦500, we get: X = $60 / ₦500 X = $0.12 per Naira Therefore, the exchange rate of the UK with Nigeria is $0.12 = ₦1.00