Day 31 in MIT Sloan Fellows Class 2023, Challenges for Japanese Student - currency
In this topic, I will articulate typical challenges Japanese students face in international MBA programs.
Currency and scale matters
Each country has its own currency, but the U.S. dollar has always been the key currency.
It is said that Japanese people have excellent numerical thinking skills, but even they struggle with transforming yen to dollar or vice versa.
In fact, converting dollars to Japanese yen is a bigger task than one might imagine, as it involves not only simple multiplication of exchange rates, but also further scale issues.
Exchange rate calculation
This is the simplest part.
If you have $1, it means you have approximately 130 yen.
Simple.
Then, you have $ 1 billion, can you say 130 billion yen?
No.
Scale matters
We, the Japanese, use a different scale unit for a big number.
1 - ichi
10 -jyu
100 -hyaku
1000 -sen
10000 -man
100000 - jyu man
1000000 - hyaku man
10000000 - sen man
100000000 -oku
In the US, the scale unit is a thousand. Once you reached thousand - X, then you can move to different scales such as million, billion etc.
The way the Japanese digits are grouped and the way the US digits are grouped are off by one digit.
How we can transform
If you have $ 10 billion, then you need to two calculation.
- Multiply exchange rate
- Apply Japanese scale unit.
So, USD 10,000,000,000 means 1,300,000,000,000 yen.
Then, we change the scale to 1,3000,0000,0000 yen.
It means 1 cho 3 sen oku.
I hope how complicated it is and please forgive Japanese students for their slow calculation about currency!
