## Code Outline of the Exchange Function In this lesson, we'll outline the steps of the `exchange` function. First, the function calculates the `A` and `gamma` parameters. Then, it copies token balances from the state variable `balances` into an array in memory called `xp`. The function then updates the `xp` array for the token in, and the state variable `balance` for the token in. Next, the code unpacks the `price_scale`. The `price_scale` is stored in a single `uint256`. After unpacking the `price_scale`, the code calculates the transformed normalized balances into the `xp` array using the following calculation: ```javascript xp[i] = price_scale[i] * xp[i] * (precisions[i] / 10**18) ``` This calculation takes the `price_scale` element and multiplies it by the corresponding current value of `xp` element and then by a `precisions` value, which normalizes token balances to have 18 decimals. Because `price_scale` has 18 decimals of precision, we cancel out the `10**18` by dividing by `10**18`. The result is that each element of `xp` will hold a transformed balance with 18 decimals. Next, the code checks if A and gamma are updating. If they are, a value D will be calculated and updated. This logic handles cases when the curve of the b-two amm is changing its shape. Then, using the current parameters, the code calculates the value D, which determines the shape of the curve at this moment. Following this, the code calculates the token out balance. Taking the difference between the new token out balance and the previous token out balance, the code will determine the amount of the token to send out. Once the amount of token out is known, the swap fee can be calculated. Then, the token out balance is updated, the token in is transferred, the token out is transferred, and an internal function called `tweak_price` is called. The `tweak_price` function is called if the difference between the current price and the center of liquidity is significant enough. Curve b2 will then decide to re-peg if it has made enough profit. This completes the code outline for the `exchange` function.