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Exchanging Money???

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We are leaving in one week on our two week trip to Sri Lanka. We are from the US and I am wondering what is the easiest way to deal with money in Sri Lanka. Should we take travelers checks or US dollars? We have paid for very little of our trip up front so I am concerned with bringing a lot of cash. If we do bring US dollars can we use them for tips, etc or is it better to exchange and use rupees.

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