GCSE Maths Practice: currency-conversion

Higher GCSE Currency Conversion (Multiple-Choice)

At Higher GCSE level, currency conversion questions are designed to test both accurate calculation and strong numerical reasoning. Multiple-choice questions add an extra layer of challenge, as you must not only calculate correctly but also recognise which options are clearly unreasonable before doing detailed working.

Understanding the Exchange Rate

An exchange rate shows how much one currency is worth in another. For example, if £1 = €1.21, this means that one pound is worth one euro and twenty-one cents. When converting from pounds to euros using this rate, the numerical value will increase because the exchange rate is greater than 1.

Recognising this immediately allows you to discard options that are too small before calculating.

Estimation as a First Step

In multiple-choice questions, estimation is a powerful tool. Before multiplying, round the exchange rate to make the calculation easier.

For example, rounding €1.21 to €1.20 allows you to estimate quickly. If £280 were converted at €1.20 per pound, the result would be just over €330. This helps you eliminate any options that are far above or below this range.

Exact Calculation Method

Once you have estimated, confirm the correct answer by calculating accurately:

• Write down the multiplication clearly.
• Multiply using correct decimal arithmetic.
• Check that the number of decimal places is correct.

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

Worked Example (Different Numbers)

Suppose the exchange rate is £1 = €1.19.

Convert £360 to euros.

Step 1: Estimate first. £360 × 1.2 ≈ €432, so the exact answer should be slightly less.

Step 2: Multiply: 360 × 1.19 = 428.4

Step 3: Write the final amount → €428.40

Another Example

If £1 = €1.26 and someone exchanges £215:

215 × 1.26 = 270.9 → €270.90

Common Higher-Tier Errors

• Skipping estimation: This makes it harder to eliminate incorrect options.
• Decimal misplacement: Always check where the decimal point belongs.
• Choosing the nearest round number: Correct answers are not always neat.
• Ignoring money formatting: Values should be written to two decimal places.

Real-Life Relevance

Currency conversion with non-round rates is common in real life, including:

• Paying for hotels or travel abroad
• Converting salaries or large purchases
• Online shopping from international retailers
• Understanding bank and exchange service rates

Frequently Asked Questions

Is estimation enough to answer multiple-choice questions?
Estimation helps narrow choices, but exact calculation should be used to confirm the answer.

Why do exam questions use awkward exchange rates?
To test precision and careful handling of decimals.

Should I always write two decimal places?
Yes. Money values should normally be given to two decimal places.

Study Tip

For multiple-choice currency questions, estimate first to eliminate wrong answers, then calculate carefully to confirm the correct one.