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Problem of the Week

Petrol Price Comparison

To compare petrol prices (cost/volume) across countries, you need to know the exchange rate for the currency (we use AUD) and use the same unit of volume (we use litres). Last week, regular petrol in New Zealand was selling for 2.859 New Zealand dollars (NZD) per litre, while in the United States regular petrol was selling for 4.699 US dollars (USD) per gallon. Which was the less expensive? (Use these conversions: 1 gallon = 3.8 L, 1 USD = 1.37 AUD, 1 NZD = 0.93 AUD)

Answer:

Convert both prices to AUD/L.

 

New Zealand: 1 NZD = 0.93 AUD

2.859 NZD = 2.859 x 0.93 AUD = 2.66 AUD

Cost per litre = $2.66 (to the nearest cent)

 

United States: 1 USD = 1.37 AUD

4.699 USD = 4.699 x 1.37 AUD = 6.44 AUD

Cost per gallon = $6.44

1 gallon = 3.8 L

Cost per litre = $6.44/3.8 = $1.69  (to the nearest cent)

 

Petrol last week was less expensive in the United States, than in New Zealand.

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