An exchange rate specifies the value of one currency in terms of another currency.

$$\ell ( \theta ) = \sum _ { i = 1} ^ { m } \operatorname{log} p ( x ; \theta )$$

**If USDINR falls from 70 to 60, it means value of 1$ has fallen from INR 70 to INR 60**

1$ is now worth only INR 60 against the previous value of INR 70

has depreciated against INR/ has fallen against INR

$ has fallen below INR 70 vs INR

$$\frac{a}{b}$$

To find how much $ has fallen against INR, we do the following calculation:

$$\frac{a}{b}$$

$$Change in USDINR(%)=\frac{New Spot Rate-Old Spot Rate}{Old Spot Rate}*100$$

```
=((60-70)/60)*100=-16.67%
```

**If USDINR falls from 70 to 60, it means only INR 60 is required to buy 1$ against INR 70**

1 INR is now worth more , that is 0.0166 against 0.0142
INRUSD has risen to 0.0166 from 0.0142
INR has appreciated against /INR has moved higher against $

INR has moved above/past Rs 70

To find how much INR has appreciated or risen against $, we do the following calculation:

Change in INRUSD(%)=((New Spot Rate-Old Spot Rate)/(Old Spot Rate)) * 100

```
=((0.0166-0.0142)/0.0142)*100=16.9%
```

Whenever depreciates against INR, it also means INR appreciates against