Digital PSAT Math Practice Question 257: Answer and Explanation

Question: 257

A currency conversion store at an airport in New York City posts the following conversion rate table:

The conversion store charges 1 percent of the amount converted, plus a $2 flat fee for each total transaction (including multiple-currency exchanges, so long as they take place in a single visit to the store. The fee is assessed in addition to the 1 percent conversion fee).

Suppose a customer wanted to see the conversion rate, before doing a transaction with any associated fees, of U.S. dollars to Australian dollars. What is the conversion rate of U.S. dollars to one Australian dollar to the nearest hundredth?

Correct Answer: 0.71

Explanation:

0.71 The fees in this case are extra information that you don't even need, because the customer wants to know what the conversion is without taking fees into account.

1 USD = 1.41 AUD. You want to know how many USD a person would get for 1 AUD, so divide both sides by 1.41:

0.709 USD = 1 AUD. Rounded to the nearest hundredth, the answer is 0.71.