230 ECONOMIC PRINCIPLES

par. But we have seen that demand and supply can be
equated at different rates of exchange, so that the par, if so
defined, would not be a unique point. Were the amounts to
be paid and received expressed in terms of the same unit of
value, the definition, in the form first given, would be precise,
but would only amount to saying that the par of exchange
Is reached when one unit of value in the one country will
purchase the right to receive one unit of value in the other
country. Even if the two countries have the same unit of
monetary valuation, we can only learn the variations of the
rate of exchange, not those of the condition of mutual
indebtedness. When, as is usually the case, the amount to
be paid and that to be received are expressed in different
monetary units, a means of expressing the one unit in terms
of the other is needed before we can test the equality of the
obligations on the one side with those on the other. In
practice, instead of this ideal par, the “ mint par of exchange”
is employed, which is defined as follows. Take two sums,
of the currency of the two countries, which are represented
in gold coin, at the mintage rates, by quantities of coin
containing equal amounts of pure gold. Then, the rate of
exchange which makes these two sums equivalent to each
other is the mint par. It is obvious that, when the currency
units are the same in the two countries, the mint par is the
same as the par stated above, namely, the equivalence of
anit for unit.
If the purity of the metal of which the coins are made is
the same in the two countries, the mint par is reached when
equal weights of gold coin are equivalent. Thus France,
Germany, Russia, Austria, and Denmark, as also the United
States, coin gold at a fineness of nine-tenths, that is, there is
ten per cent. of alloy in the coins in each case. Ten
kilogrammes of gold coin, according to the mint laws of these
countries, will contain respectively coins of the value of
31,000 francs, 25,110 marks, 11,625 roubles, 29,520 kronen of
Austria, and 22,320 kroner of Denmark, These amounts of
currency are therefore equivalent to each other when the
exchanges are at par. Exchange is at par between France
and Germany when it stands at the level which makes