Please let me know in detail abut the forex and currency trading business?

Answer
It's a way to invest your money kind of like the stock market. You are buying and selling, just like the stock market. But rather than buying and selling the actual currency itself, you are buying and selling the DIFFERENCE in value (aka the exchange rate) between two different currencies.

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How are currency exchange rates calculated?

The US Dollar is declining in value against the British Pound and the Euro, but the decline versus the Euro is greater.
If US interest rates are reset lower, I am told that the value of the Dollar versus the other currencies declines further.
These exchange rates are calculated to four decimal places, indicating significant precision.
If the Chinese Yuan is set higher than it currently is, what will that do to the Dollar versus the Pound and the Euro?

Answer
Exchange rates are not calculated the are determined by the currency exchange markets where traders by and sell currencies. see FOREX.
The theory predicts that that the demand for dollars is dependent on the interest investors can get on dollar denominated bonds, so a lower interest rate decreases the demand and would lower the "price" of the dollar, but the amount of the decrease is a rough estimate.