This helped me out:

**Note:** Exchange rates can be quoted two ways:

e = ¥ / , or the **Foreign Currency per U.S **. When e gets bigger (100 to 120), dollar gets stronger, **appreciates** in value (and the Yen depreciates). $1 will buy more foreign currency, or it takes more Yen to buy a $1. When e gets smaller (100 to 80), dollar gets weaker, **depreciates** in value (and the Yen appreciates). $1 will buy fewer Yen, or it takes fewer Yen to buy a $1. Just like a price of $2/gallon of gasoline, when the P gets bigger the value (price) of gas increases (it’s in the denominator), when P gets smaller the value (price) of gas decreases.

e = / £ (British pound), or the **U.S. equivalent** , or U.S. Dollars per national currency unit. When this e gets bigger, the £ get stronger (appreciates) and the dollar gets weaker (depreciates), because it takes more dollars to buy a £. When e gets smaller, the £ depreciates and the dollar gets stronger. It costs less for us, in U.S. $, to buy a pound.

**POINT:**** 1. When e (exchange-rate) gets bigger, the currency in the DENOMINATOR gets stronger (appreciates).****2. When e (exchange-rate) gets smaller, the currency in the DENOMINATOR gets weaker (depreciates).**