GCSE Maths Practice: currency-conversion

Question 1 of 10

Use the given exchange rate to convert the amount from pounds into euros, then round appropriately.

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\( \begin{array}{l} \text{£1 = €1.17} \\ \text{Convert £420.80 to euros.} \end{array} \)

Choose one option:

Do not round too early. Always round only the final answer.

Higher GCSE Currency Conversion with Rounding

At Higher GCSE level, currency conversion questions are designed to test more than just basic multiplication. You are expected to work accurately with decimals, apply an exchange rate correctly, and round your final answer appropriately. These questions reflect real-life financial calculations, where precision matters.

Understanding Exchange Rates

An exchange rate shows how much one currency is worth in another. For example, if £1 = €1.17, this means that one pound is equivalent to one euro and seventeen cents. When converting from pounds to euros, the value will increase because the exchange rate is greater than 1.

At Higher tier, exchange rates often include two decimal places, making careful calculation essential.

Method for Higher Tier Questions

Follow this structured approach:

  • Write down the multiplication clearly.
  • Multiply using accurate decimal arithmetic.
  • Round the final answer to two decimal places.

A common mistake at Higher tier is rounding part-way through the calculation. This can lead to inaccurate final answers.

Worked Example (Different Numbers)

Suppose the exchange rate is £1 = €1.23.

Convert £368.40 to euros.

Step 1: Write the calculation: 368.40 × 1.23

Step 2: Multiply: 368.40 × 1.23 = 453.132

Step 3: Round to two decimal places → €453.13

Another Example

If £1 = €1.09 and someone exchanges £575.60:

575.60 × 1.09 = 627.404 → €627.40

Common Higher-Tier Mistakes

  • Rounding too early: This reduces accuracy.
  • Incorrect decimal placement: Always check where the decimal point belongs.
  • Forgetting to round: GCSE questions usually expect two decimal places for money.
  • Assuming estimation is enough: At Higher tier, exact calculation is required.

Real-Life Applications

Accurate currency conversion is essential in many real-world situations:

  • Booking flights or accommodation abroad
  • Managing international business transactions
  • Comparing overseas salaries or large purchases
  • Understanding exchange values in banking and finance

Frequently Asked Questions

Why must I round to two decimal places?
Because most currencies use two decimal places for cents.

Should I estimate first?
Yes. Estimation helps you check whether your final answer is reasonable.

Will Higher GCSE questions always include rounding?
Very often, yes. Rounding is a key Higher-tier skill.

Study Tip

Write every step clearly and round only once at the end. This reduces errors and improves exam accuracy.

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