Hamish and Grace MacDonald have been investigating the cost of a holiday in Britain. From their home in Welland, Ontario, it is equally inconvenient to fly out of Toronto or Buffalo, New York. On the Internet, they have found that they can fly Buffalo-London return on JetBlue Airlines for US$975 each, rent a hotel room in London for two people for one night at a cost of £87, and join Jolly Tours the next day for a two-week all-inclusive coach tour at a cost of £1150 per person. Alternatively, the MacDonalds can purchase an all-inclusive package (including a similar coach tour) from a local travel agent for C$3950 per person. Which alternative is cheaper? How much cheaper is it in C$ for two people?

If the necessary exchange rates are not given in problem, use the exchange rates in Table 3.2.

Table 3.2.

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Per C$ Per US$ Per € Per Y Per £ Canadian dollar (C$) 1.3083 1.4446 0.01084 2.0203 U.S. dollar (US$) 0.7644 1.1042 0.008286 1.5442 0.6922 0.9056 0.007504 1.3985 Euro (€) Japaense yen (V) British pound (£) 92.2509 120.6919 133.2657 186.3745 0.4950 0.6476 0.7150 0.005366