1. The problem is to understand when to use the buying rate or the selling rate in currency exchange. 2. The buying rate is the rate at which the exchange service buys foreign currency from you. 3. The selling rate is the rate at which the exchange service sells foreign currency to you. 4. Important rule: If you are exchanging your foreign currency to get local currency, you use the buying rate. 5. If you want to buy foreign currency using your local currency, you use the selling rate. 6. Example: If you have foreign currency and want local currency, multiply the amount of foreign currency by the buying rate. 7. If you want to buy foreign currency, multiply the amount of foreign currency you want by the selling rate to find out how much local currency you need. This helps you decide which rate to use based on whether you are buying or selling foreign currency.