How do you determine the best deal from several options and convert between currencies in both directions?
Determining the best deal given several pieces of information by comparing unit costs or total costs, and converting between currencies using an exchange rate in both directions.
A focused answer to the SQA National 5 Applications of Mathematics finance content on best deal and currency, covering comparing several offers by unit cost or total cost to find the best value, and converting between currencies in both directions using a given exchange rate.
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What this dot point is asking
The SQA wants you to compare several offers and decide which is the best deal, justifying your choice, and to convert between two currencies in both directions using a given exchange rate.
Determining the best deal
Best-deal questions give several offers and ask which is the best value. They cannot be compared directly because the sizes or quantities differ, so reduce each to a common measure first.
Always compare in the same units, and state the conclusion with its reason; the SQA awards a mark for the justified decision, not just the arithmetic.
Best-deal questions are not always about packs of food. They might compare two mobile phone tariffs, two car-hire offers, or two ways of buying tickets, where the cheapest total for the same usage wins. When the offers include a fixed charge plus a rate, work out the full cost for the quantity in the question. For example, one tariff at plus p per minute and another at with free minutes can only be compared by costing the actual number of minutes used.
Converting currency
A currency conversion uses an exchange rate, such as \pounds 1 = \1.30$. The direction of the calculation decides whether you multiply or divide.
The key is the direction. Going to the currency named after the equals sign multiplies; coming back to pounds divides. A quick sense-check helps: if buys more than one unit of the foreign currency, then a sum in pounds becomes a larger number of the foreign currency, and a foreign sum becomes a smaller number of pounds. Some questions also charge a commission or fee on the exchange, which is subtracted before or after converting, so read carefully to see when the fee applies.
Examples in context
These skills are everyday finance. A shopper compares packs of different sizes to find the cheapest per unit; a holidaymaker changes pounds into euros for a trip and back again on return; a business chooses the cheapest supplier by unit cost. Each rests on a fair comparison on a common basis, or applying an exchange rate the right way round, the skills here.
Try this
Q1. A g jar costs and a g jar costs . Which is better value per gram? [3 marks]
- Cue. vs per gram, so the g jar.
Q2. With \pounds 1 = \1.40\pounds 90$ to dollars. [2 marks]
- Cue. 90 \times 1.40 = \126$.
Q3. With , convert to pounds. [2 marks]
- Cue. .
Exam-style practice questions
Practice questions written in the style of SQA exam questions on this dot point, with worked answer explainers. The year tag is the paper they imitate, not the source.
SQA N5 Apps style4 marksWashing powder is sold as a g box for , a kg box for , or a kg box for . Which box is the best value? Justify your answer.Show worked answer →
Compare the cost per gram (or per kilogram) for each box. Small box: per gram, that is p per gram (1 mark). Medium box: per gram, p per gram (1 mark). Large box: per gram, p per gram (1 mark). The medium kg box is the best value at p per gram (1 mark). Markers reward a consistent unit cost for each box and a justified conclusion. Compare in the same units throughout.
SQA N5 Apps style3 marksThe exchange rate is \pounds 1 = \1.25\pounds 240\ back to pounds.Show worked answer →
To convert pounds to dollars, multiply by the rate: 240 \times 1.25 = \30080 \div 1.2580 \div 1.25 = \pounds 64$ (1 mark). Markers reward multiplying when going from pounds to dollars and dividing when going from dollars to pounds. Mixing up the two directions is the usual error.
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