Multiplications and Divisions in Currency Questions
A number of people that are about to take numerical reasoning test may be afraid of currency conversion questions. Why is that? Perhaps it is because they may be under the impression that these questions are ‘difficult’ to work out or they simply don’t know where to start. Below, we provide you quick tips on how to work out the most common type of currency conversion questions that may appear in graduate numerical reasoning tests.
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Cross multiplication and division
Cross multiplication and division is the most commonly used technique to solve majority of currency conversion questions at numerical reasoning tests. However, it is important that you use this technique correctly. That is, it is important that you multiply and divide correct values from the table, chart or graph in correct way. To demonstrate this, consider the table 1 and question 1.
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In Q1, how much EUR could trader buy for BRL 6,200 if 1GBP was worth 3.1612 BRL?
In the above question you need to work out the amount of Euros trader could buy for BRL 6,200. All you need to do is to perform the following calculation: 6200/3.1612 x 1.2749. If you are new to these kinds of currency problems and you find it difficult to organise the above steps in your head then break it down to cross multiplication and division table as shown below.
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Note that you will always cross multiply and then divide. To find the value of BR 6,200 in GBP perform the following calculation 6,200 x 1 / 3.1612. It's that simple. Once you know how much GBP is worh BR 6,200 you can sketch the second table as shown above where you will calculate how much EUR is worh GBP 1,961.28. Using cross multiplication and division table is very straightforward and virtually you cannot go wrong. The only disadvantage is that it may take some time to sketch these on the scrap paper nevertheless if you undertake enough practice you will be able to visualise these tables in your head. If you want to review further example then continue reading, however if you want review further topics on foreign exchange rate questions then see currency conversion guide for numerical tests.
Similar example though slightly different is demonstrated in table 2 and question 2 where you need to work out the amount of Brazilian Real that equals to 500 Pounds. To work out the below questions use exchange rate as provided in the test question (however, in the below example, no matter which rate you use you should get the same result).
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How much was worth GBP 500 in Brazilian Real using EUR exchange rate?
Again, all what is required in this question is to perform the following calculation: 500 x 1.2749 / 0.4033. If you are beginner and you don’t have an extensive experience to work out currency conversion questions or you find it puzzling to visualise what rate to multiply or divide with what currency then break down you calculation as per below:
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Remember, you need to get more practice so that you can visualise these steps in your head quickly and correctly. Note that sketching these cross multiplication and division tables may be time consuming during your numerical reasoning test.