GCSE Maths Practice: currency-conversion

Currency Conversion with Decimal Results

Currency conversion is a key GCSE Maths topic that applies ratio and proportion to real-life money situations. At Foundation level, questions often involve converting pounds into euros using a single exchange rate. While the method is straightforward, careful calculation and correct money formatting are essential, especially when the final answer includes decimal values.

Understanding the Exchange Rate

An exchange rate shows how much one currency is worth in another currency. For example, if £1 = €1.25, this means that one pound is worth one euro and twenty-five cents. Exchange rates are always provided in GCSE questions, so there is no need to memorise them.

Because the exchange rate is greater than 1, converting from pounds to euros will increase the numerical value. Recognising this before calculating helps you avoid answers that are too small.

Choosing the Correct Calculation

At GCSE Foundation level, currency conversion usually follows this simple rule:

• Pounds to euros: multiply by the exchange rate
• Euros to pounds: divide by the exchange rate

Before calculating, it is good practice to think about whether the answer should be larger or smaller than the original amount.

Worked Example (Different Numbers)

Suppose the exchange rate is £1 = €1.30.

How many euros is £115?

Step 1: Estimate first. £115 × 1.3 is close to £100 × 1.3 = €130, so the answer should be a little higher.

Step 2: Multiply: 115 × 1.30 = 149.5

Step 3: Write the answer as money → €149.50

Another Example

If £1 = €0.92 and someone exchanges £180:

180 × 0.92 = 165.6 → €165.60

Common Mistakes to Avoid

• Incorrect decimal multiplication: Always line up decimal points carefully.
• Forgetting to estimate: Estimation helps catch large errors.
• Missing the currency symbol: GCSE mark schemes expect correct notation.
• Not writing two decimal places: Money values should normally be written to two decimal places.

Real-Life Applications

Currency conversion is used in many everyday situations, such as:

• Budgeting spending money for holidays
• Paying for accommodation or travel abroad
• Shopping on international websites
• Managing expenses for school trips or events

Frequently Asked Questions

Why do some answers include decimals?
Because exchange rates often involve decimals, the converted amount may not be a whole number.

Do Foundation GCSE questions include large numbers?
Yes. Larger values test careful calculation but use the same method.

Should I always write two decimal places?
Yes, unless the value is exactly a whole number of euros.

Study Tip

Always estimate before calculating and check that your final answer matches your estimate. This reduces the risk of careless errors.