Working with National Numeracy Day on 15 May, we’ve compiled a quiz – and some tips on how to improve your skills. Answers below.
After making a deposit, Damien’s bank account went from £1,680 overdrawn to £425 in credit. How much was deposited?
(a) £1,025 (b) £2,255 (c) £1,255 (d) £2,105
2. In the shops
A radio cost £35, which then increased by 10%. A retailer has now cut 10% off the new price in a sale. What’s the price now?
(a) £34.65 (b) £35.00 (c) £34.50 (d) £35.60
3. Simple interest
After a lot of searching, you find a savings account that pays interest at 1.6% AER. You are allowed to invest a maximum of £500 in the account. How much interest will you earn if you invest the maximum amount for one year?
(a) £16.00 (b) £8.00 (c) £5.16 (d) £4.88
4. Getting to work
Rail fares are set to rise by 3.5%. If a season ticket costs £1,650 now, how much will it cost after the increase, to the nearest pound?
(a) £1,654 (b) £1,665 (c) £1,708 (d) £1,995
5. Holiday money
If the current exchange rate for US dollars is £1 = $1.22, how many dollars should you get for £210, to the nearest 10 dollars?
(a) $190 (b) $230 (c) $260 (d) None of these
6. At work
FitURite garage employs one manager and nine fitters. The average (mean) salary for all employees is £16,600. If the manager’s salary is £22,000, what is the average salary of the fitters?
(a) £17,000 (b) £18,500 (c) £15,800 (d) £16,000
7. At the petrol station
You have a voucher to save 10p a litre on fuel. How much would you save when filling up an empty 12 gallon fuel tank? (one gallon = 4.5 litres)
(a) £5.40 (b) £4.50 (c) £4.95 (d) £5.25
8. Splitting a restaurant bill
Three people shared a restaurant bill equally. Their meals cost £15.50, £17.00 and £16.50, and their drinks cost a total of £24.98. They left a 10% tip. How much did each person pay?
(a) £27.13 (b) £29.25 (c) £17.97 (d) £24.6
9. Paying the rent
Sandy’s gross monthly pay is £2,250, before tax and other deductions. She pays rent of £675 per month. What percentage is this of her gross pay?
(a) 30% (b) 40% (c) 50% (d) 60%
10. What’s left?
Marcus has an annual salary of £24,000, before deductions. He pays 18% of his gross salary in tax and national insurance, and another 25% of his gross pay goes on rent. How much is left each month?
(a) £1,579 (b) £1,368 (c) £1,476 (d) £1,140
11. Debts and savings
Marcia owes £4,000 on a credit card that she pays 15% interest on. She also has £4,000 in a savings account paying 2% interest. How much better-off will she be each year if she uses her savings to pay off the debt?
(a) £80 (b) £190 (c) £380 (d) £520
12. Buying a car
Dan borrows £6,000 from a finance company to buy a second-hand car. The company charges 5% interest and offers a range of repayment plans. Which of these options has the lowest total cost?
(a) 36 payments of £179.81 (b) 48 payments of £138.17 (c) 60 payments of £113.22 (d) It makes no difference – they all cost the same
13. Paying a little more
Sam and Jo take out a £185,000 repayment mortgage with a 3.5% interest rate and monthly repayments of £926 over 25 years. However, if they make additional payments of £200 every month, the mortgage will be fully repaid after just 224 monthly payments. Which of these is the best estimate of the amount they would save by making the overpayments?
(a) £25,600 (b) £15,300 (c) £9,800 (d) £18,800
14. Credit cards
In the UK, about £20,000 is spent using credit and debit cards every second. How much is spent each month? Pick the best estimate.
(a) £945 (b) £5.89bn (c) £53bn (d) £111m
1 (d); 2 (a); 3 (b); 4 (c); 5 (c); 6 (d); 7 (a);
8 (a); 9 (a); 10 (d); 11 (d); 12 (a); 13 (a); 14 (c)
Making it all add up
We asked National Numeracy, a charity, for tips on how to handle the everyday challenges of financial transactions, and how to improve your money maths. You can also go online to the National Numeracy Challenge, a free online learning tool designed to help you improve your everyday maths skills. It will give you a breakdown of your capability in five areas of numeracy, and tips on how to get better. Here’s its advice on coping with everyday challenges if maths is not your strongest trait.
• Keep control, even if you delegate. If someone else handles your finances, make sure you are closely involved in the process. Always examine the figures before making any decisions, so that you are in command of your financial situation both now and later down the line.
• Check your understanding of percentages. This is an area where many people struggle, and it features in nearly all of the financial decisions you will make in life. Do you use the percentage button on your calculator? The difference between 0.2% and 1% may not seem much, but on a sizeable loan or investment this can make a huge difference both now and how it plays out over time.
• Know when to use savings v credit. Understanding the basics about interest (especially compound interest) will help you to be better with money. Some people like to keep cash on hand for “emergencies” rather than paying off debts. This is generally a bad idea – borrowing costs more than the interest you will earn on savings, so paying off debts will cost you less.
• Know when to pay more. When discussing a remortgage or investment, prepare by doing calculations in advance. In the case of a mortgage, understand how repayments would be affected by an increase in interest of 0.5%, 1%, 1.5% and so on, and how reducing the term could reduce how much you pay in total.
• Audit your numeracy skills. Our ability with numbers can fluctuate throughout life. If you suspect you may be out of practice and could benefit from taking steps to improve, then the National Numeracy Challenge website can help.