GCSE Maths Practice: currency-conversion

Higher GCSE Currency Conversion with Decimal Values

At Higher GCSE level, currency conversion questions are designed to test accurate decimal multiplication, sensible estimation, and correct interpretation of exchange rates. Unlike Foundation questions, the values used are often awkward decimals, and the exchange rates are chosen to make careless rounding more likely.

Understanding the Exchange Rate

An exchange rate such as £1 = €1.29 means that every pound is worth one euro and twenty-nine cents. Because the exchange rate is greater than 1, converting from pounds to euros will increase the numerical value. Recognising this immediately allows you to rule out answers that are clearly too small.

Before calculating exactly, it is good practice to estimate the answer. Rounding €1.29 to €1.30 gives a quick mental check. Multiplying £132.40 by €1.30 would give a value just over €170, so the correct answer should be close to that figure.

Using Estimation in Multiple-Choice Questions

Estimation is especially powerful in multiple-choice questions. By rounding the exchange rate or the amount, you can often eliminate one or two options immediately before doing any detailed calculation. This saves time and reduces the risk of selecting an unreasonable answer.

Exact Calculation Method

Once estimation has narrowed the choices, confirm the correct answer by calculating accurately:

• Write the multiplication clearly.
• Multiply using full decimal precision.
• Keep all decimal places during working.
• Check the final decimal placement carefully.

Because this is a Higher-tier question, accuracy is essential.

Worked Example (Different Numbers)

Suppose the exchange rate is £1 = €1.27.

Convert £148.60 to euros.

Step 1: Estimate first. £150 × 1.3 ≈ €195, so the answer should be slightly below this.

Step 2: Multiply: 148.60 × 1.27 = 188.722

Step 3: Round to two decimal places → €188.72

Another Example

If £1 = €1.34 and someone exchanges £96.80:

96.80 × 1.34 = 129.712 → €129.71

Common Higher-Tier Errors

• Misplacing the decimal point: Always check how many decimal places are required.
• Skipping estimation: Estimation helps spot unreasonable options quickly.
• Rounding mid-calculation: This reduces accuracy.
• Choosing the nearest round number: Correct answers are often not neat.

Real-Life Relevance

Currency conversion with decimal values is common in real-life situations, such as:

• Online shopping from overseas retailers
• Paying for travel, accommodation, or events abroad
• Managing international expenses
• Understanding bank and exchange bureau calculations

Frequently Asked Questions

Is estimation enough for multiple-choice questions?
Estimation helps narrow choices, but calculation should always confirm the answer.

Why do Higher GCSE questions use awkward decimals?
They test precision and careful handling of decimal numbers.

Should money always be written to two decimal places?
Yes. Currency values should normally be written to two decimal places.

Study Tip

For Higher-tier multiple-choice currency questions, estimate first to remove impossible answers, then calculate carefully and check decimal placement before choosing your final answer.