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I've been thinking about going to the Europe on a Vacation but I am confused to how their currency works. According to Google 700 American dollars would be around 500 in Europe? I'm so confused, Why is it less? How exactly does this all work?
It depends where in Europe you're going. What you looked up was probably what the exchange rate was for the Euro. The Euro is used by these countries; http://en.wikipedia.org/wiki/Eurozone.
Not all countries use the Euro. The UK still uses the pound, Denmark (where I currently am) uses the krone, etc.
Regardless of where you go in Europe, the exchange probably isn't going to work out in your favor. Europe is an extremely expensive place and the dollar doesn't convert very well into anything. For example, a can of coke in the US costs maybe 75 cents to a dollar from a 7/11. In Denmark, it's the equivalent of 2-3 dollars. Apply that monetary logic to larger purchases like food and lodging and transportation, and it's going to cost a good deal to vacation in Europe. Save up.
(Rating: 5) thanks!