What Are Exchange Rates?
Exchange Rate: The price paid for one currency in terms of another
If a business sources products of component materials from abroad, or if they sell to overseas customers then they are influenced by the exchange rates between currencies.
To convert £ to a foreign currency, multiply by the exchange rate.
To convert a foreign currency to £, divide by the rate.
Importing and Exporting
Imports: goods or services made overseas which importers bring into the country or which UK citizens use overseas, for which payment leaves the country.
Exports: goods or services made in the UK which exporters take away from the country, which foreign citizens usem where payment enters the country.
A strong pound reduces costs for importers.