Mathwhich is correct
posted by Christy .
1 euro is worth 1.2 U.S dollars
if I budget 150$ per night for a hotel room. What is the maximum number of euros I should spend for a room?
My answer is 108 euros as a maximum (with an actual number of 107.425)
Correct???
* Mathcheck my answer  DrBob222, Tuesday, September 15, 2009 at 4:09pm
I get a different number.
$150 x (1 euro/$1.20) =
* Mathcheck my answer  Christy, Tuesday, September 15, 2009 at 4:25pm
Bob are you getting 180 euros ?
That was my first answer but it looked wrong
* Mathcheck my answer  DrBob222, Tuesday, September 15, 2009 at 4:28pm
No. Are you using a calculator. 150/1.2 = 125.
* Mathcheck my answer  Ms. Sue, Tuesday, September 15, 2009 at 4:30pm
Yes, Christy, $180 is correct.
Think of it this way. If you buy a cup of coffee for 1 Euro, you're spending U.S. $1.20. As DrBob showed, you multiply the number of Euros by the amount you paid in U.S. dollars for each Euro.
* Mathcheck my answer  Christy, Tuesday, September 15, 2009 at 4:43pm
So she should only spend 125 euros that would be the equivalent of 150$ US ?
I am confused as to what the true answer should be ?

Are you in a country which requires VAT at 16.36%? Or in a state which levies sales taxes on hotel rooms?

this example is just a math story problem. not based on any real life situation.

I think there is a confusion with the budget.
If the budget is US$150, and the conversion is 1€=US$1.20, then the budget is US$150*(1.00€/US$1.20)
=125€
Note how the US$ cancel out to leave &euro as the unit. 
I'm sorry  but it looks like I was wrong in my previous answer.
Check this site for a computerized answer.
http://www.xe.com/ucc/convert.cgi 
Please note that it will give you a number in Euros at today's exchange rate  which is a little different than the one given in your problem. But it should point you in the right direction.