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Exchange rates

When tourists travel from one country to another, they have to change money into the currency of the country they are visiting.  So, when UK tourists visit France or Spain they have to buy euros.  Likewise, when tourists from the USA visit the UK, they have to buy British pounds.

Also, when tourists use credit cards while they are abroad on holiday, what they spend when they are on holiday is converted back into British pounds when they receive their bill.

An example is shown below.  The credit card was used to buy a number of goods and services in France in Euros. These amounts were then converted into British pounds by the credit card company.