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Maths for Everyday Life English | 2009 | 32 pages | PDF This short course hopes to give you all the maths you need for day-to-day life. After completing the course, you should never again have to say either to yourself or to someone else, "I wish I could do that, but I’m no good at figures." Table of Contents Lesson 1: Course Outline 3

Lesson 2: Practical Maths

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Lesson 3: Converting Things

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Lesson 4: What Are the Odds?

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Lesson 5: Probability Rules

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Lesson 6: Understanding Statistics

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Lesson 7: Understanding Surveys

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Lesson 8: Is the Price Right?

26

Lesson 9: Personal Finances

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**Course Name: Maths for Everyday Life
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Lesson 1: Course Outline This course hopes to give you all the maths you need for day-to-day life. After completing the course, you should never again have to say either to yourself or to someone else, "I wish I could do that, but I’m no good at figures." It’s important to stress that regardless of your current level of math skills or knowledge, your beliefs about your ability to do math, or whatever level of frustration you feel when doing maths, you absolutely can learn the maths you need. All that’s needed is a bit of motivation. Now, granted, you won’t become a maths expert overnight—it’s an incremental process and it takes some time. But if you complete the course, your confidence for practical maths will continue to grow. What are the benefits? There are three benefits to becoming a "maths person": practical, psychological, and intellectual. Financial rewards. When you know how to reconcile your bank accounts, understand the true cost of using credit cards, start to invest, and learn to buy high-deductible insurance, the money you save or earn can be considerable. Another practical benefit is an increased know-how when it comes to things like figuring how much carpeting or paint to buy, understanding how to convert to foreign currency when travelling, and figuring discounts, and interest rates. Learning maths is empowering. Psychological benefits. In our culture, maths skills are often equated with general intelligence. So, as you become more comfortable using maths, others are likely to be impressed—and you may actually feel smarter. Then there is the feeling of satisfaction and pride you feel when you successfully solve a maths problem. You may also enjoy being able to help your children or your friends with maths, and take pride in being the one who can instantly announce the discount amount when shopping, or the percent increase in this year’s sales over last year’s. Intellectual benefits. Business, government, economics, medicine, finance, science, and technology all use the language of maths. The more maths you know, the better able you are to understand these subjects. Once you know the necessary maths, you’ll have a better grasp of news stories about government spending, the scale of our solar system. It’s difficult to get a handle on scientific things, such as the human genome project or what relative humidity or barometric pressure mean, without a knowledge of basic mathematics. When your maths confidence grows, you’ll also have a clearer understanding of political polls, medical studies, and the countless surveys you see in the media. You’ll also feel less intimidated when reading about and working with technology, such as digital cameras and hand-held computers. While a mathematical view is certainly not the only way to look at the world, your perspective is incomplete if you don’t know at least the basics of mathematics. Use a Calculator Throughout this course, we’ll give you calculator tips and shortcuts for solving certain problems. It’s important to know how to use a calculator effectively. (Some problems are impossibly difficult or time-consuming without one.) But it’s also a good idea not to become overly reliant on them.

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this will help to get your brain in shape. Now. and many will insist that they can’t do it in their heads. we don't mean to discourage you from using a calculator. if each of the 15 people received £2. you’d need £30. But it’s a snap if you cut the problem down 4 x 25 = 100 and 4 goes into 21 5 times therefore you go 5 x £100 plus £25 (remainder) = £525 Estimate 4750 ÷ 15 in your head. or the total value of all the merchandise in a store. but it gets easier the more you do it.25). this requires that you develop your capacity for doing math on paper or in your head without relying on a calculator. A facility for estimating lies at the heart of the mathematical way of thinking. such as 40 x 25. your estimate is 325 (instead of 3.50). Practice makes perfect. you’d need $45. It is the uncertain nature of estimating that makes it so valuable: Estimating forces you to develop your mathematical judgment. you have to learn to trust your judgment without cut-and-dried formulas that provide automatic answers. Approximately how much will each person receive? Well. or 1/3 of 60. so each person gets a little more than £3—call it £3.25. In part.50. Here are a few examples: What is 21 x 25? Most people will reach for their calculators for this problem. since our problem actually involved the pence amount (4750). Another key to becoming a math person is to get in the habit of estimating mathematical things. it helps you to build your maths muscles. Now imagine you have £47. think of the 4750 as 4750 pence.50 to divide among 15 people. First. It's important to know how to use a calculator effectively. especially if you’re not used to it. You’ve got a little more than $45. 4 . it may be hard at first. it helps to go through the extra effort of doing math on paper or in your head. force yourself to do some maths in your head. If your math is rusty.000.One of the main objectives of this course is to give you greater confidence in your maths skills. the number of words on the page you’re reading. which equals £47. Here’s a great tip for doing basic arithmetic in your head: Think of money when you need to do mental maths. Estimating may not be easy at first. Look how good this estimate is: The exact answer of 4750 ÷ 15 = 316 2/3. and. if each received £3. By the way. Estimate anything: the number of square feet of area or cubic feet of volume of the room in which you’re sitting. Do some simple problems on paper rather than with your calculator. And just like working out. or a 15% tip for a dinner bill of £65. Doing math this way is similar to giving your mind a workout. but if you want to become a maths person. not the pounds amount (47. at least occasionally.

000. Begin by using the aforementioned 150 million taxpayer number. Assume that half of them (or 150 million people) pay an average income tax bill of $10. therefore.000 that would come to $150 billion.Say you’d like to know the cost of petrol for a journey in your 25 miles-per-gallon car. and never know it. 5 . residents. 1. A billion is much bigger than a million. Not only does this method reduce errors. When you do a problem the exact way—with a formula and perhaps using a calculator—you might use the wrong formula or punch a wrong button on your calculator. take a moment to ask yourself: "What’s a sensible answer here? What’s a ballpark estimate?" If your calculation is not near this benchmark. "I have absolutely no idea of how to solve that. If you don’t estimate—if you blindly follow formulas or punch buttons on your calculator—you’re at the mercy of mysterious rules and methods. You now know that you will need 120 gallons. you’ll have taken a huge step toward becoming a maths person. So.000. Say you read in the newspaper that the estimated cost of a US government initiative is $100 billion. or about $650. whenever you do a math problem. When you estimate. a thousand billions is a trillion. When you do. and you want to determine the amount per US taxpayer. We will assume that petrol costs £2 per gallon.000 miles. if each taxpayer paid $1. So. or about $2. the cost of the US government program would be 3 x $650. One gallon of petrol takes you 25 miles. This is for the average taxpayer who pays about $10. it will cost you approximately £240. you’re in control.000). 4 gallons takes you 100 miles." it’s time to push yourself to learn how to estimate such things. it puts you in the driver’s seat. you’ve likely made a mistake somewhere. Now. get the wrong answer. we were able to easily estimate the cost. Formulas and your calculator become tools that you use to confirm your independent mathematical judgment. Such problems are really quite easy when you get used to them. The numbers in the millions and billions that we see in the media on a daily basis are generally so far beyond our everyday experience that our eyes tend to glaze over. The estimated project cost was 2/3 of that—$100 billion—so the cost per taxpayer is 2/3 of $1000. you can use these very rough numbers: Assume that there are 300 million U. 40 gallons takes you 1. You might not realize your answer is wrong because you have nothing to compare it to. how can you make sense of these astronomical numbers? One trick is to convert a big number into a much smaller amount per person—this brings the astronomical number down to earth. If you pay three times that much ($30.000 x 150 million = 150 billion. Estimating also has a very practical benefit: It’s a great way to catch errors. Estimating becomes much easier once you make it a habit. since a thousand millions is a billion. the journey is approximately 3. and a trillion is much bigger than a billion in fact a thousand thousands is a million. a thousand millions is a billion.000 in income taxes.000 miles. If you’re thinking. By thinking logically and breaking the problem down into manageable figures. First. and so forth.S. So. For these conversions.

000 tax bill pays $2.Here are a couple of handy benchmarks that you can use. If you need more basic maths help your local library has information about national schemes through local classes or on the web.000 for the $100 billion program. Hopefully that’s got you thinking about maths and given you some tools to develop – we will cover more practical tools in the next lesson. From now on. for this taxpayer. The above hypothetical American taxpayer with a $30. If you do the math. That’s $20 per billion. you will know how to relate those numbers to your life. So.000 average. each billion in federal spending costs him or her approximately 20 dollars. Now you can work out your own personal benchmarks using the same formula for the UK – 55m population – 25m taxpayers at £10. whenever you see astronomical figures reported in the news. it follows that each $50 million in federal spending costs that taxpayer $1. 6 .

you have one more slice than half a pizza. Decimals. To demonstrate this technique of understanding fractions by visualizing pizza slices. However. This is also a little more than a half. if you have 5/8. the extra slice in 5/8 is more than the extra slice in 7/12. and percentages are three sides of the same coin—three ways of expressing a portion. since slices from an 8-slice pizza are bigger than slices from a 12-slice pizza. Which is greater. Because slices from a 12-slice pizza are bigger than slices from a 13-slice pizza. Which is bigger. 12/11 is more than 13/12.) 7/12 is like 7 slices of a 12-slice pizza. and 7/12 is one more slice than half of the 12-slice pizza. 5/8 or 7/12? This is easy to answer if you visualize the pizza slices. The good news is that. But. you’ve got one slice less than a whole pizza. and percentages. And for practical maths. since 6 is half of 12. Therefore. and Percentages Fractions. so 1/12 is a bit more than 1/15. Fractions An easy way to understand fractions is by visualizing pizza slices. decimals. that means that you have 5 slices from an 8-slice pizza. For example. The top number in a fraction (the numerator) indicates the number of slices that you get. let’s consider the following question: Which fraction is larger.75 pounds. 5/8 is one more slice than half of the 8-slice pizza. So in both cases.Course Name: Maths for Everyday Life Lesson 2: Practical Maths Welcome back There is some good news and some bad news: The bad news is that you can’t possibly do practical math without fractions. 1/12 or 1/15? Slices from a 12-slice pizza are a bit bigger than slices from a 15-slice pizza. the bottom number (the denominator) indicates how many slices the pizza is cut into. 3/4 of a pound is the same as 75% of a pound. approximations are often good enough. If you focus on the pizza analogy. 11/12 or 12/13? In both cases. Assume that two pizzas are the same size. the missing slice from 11/12 is bigger than the missing slice from 12/13 but you’re missing more with 11/12.) 7 . it’s a bit less than 12/13. decimals. you should have no difficulty developing a solid grasp of the approximate size of different fractions. Numbers Matter: Fractions. (And since half of an 8-slice pizza is 4 slices. which is the same as 0. 5/8 is a bit larger than 7/12. regardless of any difficulty you might have had with these topics before there’s really nothing to them. 5/8 is a little more than a half. and that one has been cut into 8 slices and the other has been cut into 12 slices. (If you are having difficulty visualizing this concept. try sketching it out on a piece of paper.

01 as 1p. the denominator of the fraction is always 10 or a power of 10:100 (10 x 10). 0.09. We used the multiplication approach above with the pizza idea. 8 .01 because £0. You should use whichever approach seems easier to you depending on the nature of the particular problem.09.) . you can often just round decimals to two places and then add or subtract just like you’d add or subtract money.05 is the same as 5/100. just being aware of this dual nature of fractions may help clear things up a bit. and comparing decimals to fractions. 2. On the other hand. Since two places of decimal accuracy is often good enough for practical math. of course.09. for example. So 23/6 is one slice shy of 4 pizzas. One thing that makes the subject of fractions confusing is that a fraction is simultaneously a multiplication problem and a division problem.00917 is less than 1 pence. and so on. 1000 (10 x 10 x 10). Since multiplication is a simpler idea than division. 5/2 or 21/10? Two 10-slice pizzas give you 20 slices.3 is more than . With decimals. at the same time. We saw in Lesson 1 that thinking of money is an easy method for doing simple arithmetic in your head. 5. Since 2 1/2 is substantially more than 2.022 as about £5. you can use the same technique to work with decimals.7 is the same as 2 7/10.30 is more than approximately £0. . Which is greater. For people who have had difficulty with fractions in the past.72 is the same as 1 72/100 or 172/100. 5/2 is the larger fraction. so 21/10 is just one more small slice than 2 pizzas (2 1/10 to be exact). 24 slices would be 4 whole pizzas. 7/8. and then the money analogy works like a charm. it's usually easier to think about a fraction like 7/8 as 7 x 1/8 or 7 eighths than to try to picture dividing 7 into 8 pieces. 0. while it’s a good idea to review how to work out these problems on paper.087 because £0. and so on.6 is the same as 6/10. Using the money method. you should have no difficulty estimating the size of a decimal number. 7/8 is 7 slices from an 8-slice pizza—that's 7 times a 1/8 slice.10 is more than £3. comparing different decimals. with a fraction such as 24/6. it's probably easier to see that 24 ÷ 6 = 4 than to do 24 x 1/6 = 4. means 7 x 1/8 and. because £6.7 as 70p.How much is 23/6? 23/6 means 23 slices of a 6-slice pizza.02.00917 is less than . For multiplication and division. For addition and subtraction. 7 ÷ 8. Here are some examples: 6. (You can always add one or more zeros to the end of a decimal number without changing its value. 0. 30p v 9p. as our money is based on the decimal system – 100p + £1. you’ll usually want to do these operations with your calculator. Think of 0. you can often round off decimals to two places. Decimals Decimals are simply fractions written in a different form.1 is more than 3. and thus it’s a little less than 4. 1.

62. you can reduce the even tenths to fifths: 2/10 is 1/5. So 18% of something is the amount of it that compares to the whole thing in the same way that 18p compares to one pound. and thus 65% equals about 2/3. Seeing the location of 65%. you’ll develop a quick. After a while. You might like to simply round percents off to the nearest 10% and then use tenths as your benchmarks since they’re so easy to picture. 3. So. or about a twelfth (they might then confirm this intuition by noting that 8 x 12 is about 100). either write it out on paper or just imagine it in your head—to locate any percentage from 1% to 100%.5%. for example. note the portions that equal 25%. which is 4/10 or 2/5.5%. and 7 slices (1/8. You may be able to easily estimate that you’ve got a little less than 1/5 of a pound as it is 2p less than a 20p piece. 9 . of course.Percentages Percentages. Imagine a pizza cut into 8 slices: We know that 25% or 1/4 of the pizza is two slices. So. and 75% as shown below. 50%.5%. 25% means 25/100. First. 5/10 is 1/2. or £48—the sale price. And. you may find it easier if you convert the percent into a fraction with 100 in the denominator. and some people have an instant sense that 65/100 is about 2/3. 15% is halfway between 1/10 and 2/10. Imagine 18p in the palm of your hand. So. are fractions written in a different form. Percentages are hundredths. you can use a scale. and uses eighths instead of tenths. 37. And. 5. A different method involves the pizza idea. 18p is a little less than 1/5—call it about 1/6 of a pound—and thus 18% of something equals about 1/6 of it. so 5 x 15 is 75. For example. 50% is four slices. Remember if you need more basic maths help your local library has information about national schemes through local classes or on the web that can help you improve your skills. since one slice is half of 25%. 60 x 80p = 4800p. A second thing you can try is to convert percentages into pence. may help you see that it’s about two thirds of the way to the top. great! If not. 15% of 500 means 15/100 of 500. leaving 80p of each pound. 4/10 is 2/5. 5% is 5/100. 83% becomes about 80%. for example. and some can intuit that. here are a couple of methods you can try. £60 marked down 20 percent means that 20p of each pound is subtracted. or 12. Focusing on the fact that a percentage is the same thing as a hundredth is all some people need to do to get a quick feel for the size of a percentage. 8% is a little less than that. you can easily note four more benchmarks for 1. and 7/8): 12. and 87. Don’t forget that if you find yourself puzzled by some percentage problem. If this works for you. 6/10 equals 3/5. and 8/10 equals 4/5. which is 8/10. Here’s a different sort of problem. You may come up with other shortcuts for picturing percentages on your own. since 10% is a tenth.5%. 8% is 8 hundredths. If you like. intuitive feel for percentages. You should be able to do this one in your head: One hundredth of 500 is 5. like decimals. For example. which equals 2/10. or again use the money tip system.5%. 38% of something is about 40%. 3/8. 5/8. and pence are hundredths of a pound. and 75% is six slices. A percent is simply a hundredth. Whatever methods you use. 65% is 65 hundredths. 19% is rounded off to 20%. the important thing is to practice estimating what quantity a particular percentage stands for.

Let's consider some additional examples: 4/5 = 4 ÷ 5. which is commonly written out as £. or 0.875 In this way. and 0. Move the decimal point two places to the left. which equals 0.35 = 35% /. you can see that it is easy to convert from a fraction to a decimal. Converting a percentage to a decimal is very simple. or 0.000 We can move further in our understanding by converting from a percentage to a fraction. we can convert any fraction to a decimal. (Note that with percents such as 400% and 213%.) In all of these examples.80 = . This is a simple two-step method using the information we've already learned.037. we have simply moved the decimal point two places to the left to convert from a percentage to a decimal.5 represents five tenths. This makes sense to us because we know from our experience using money that one half of a dollar is expressed as $. there's sort of an imaginary decimal point to the right of the last digit.065 = 6. Likewise.70. 0. This can be expressed as 5/10.8/ 95% = . and 213% = 2. into a percent.13. any percentage can be converted easily to a decimal.25. and percentages are different ways of expressing the same mathematical idea. and we know how to convert from a decimal to a fraction. 400% = 4.25. Let's consider some additional examples: . For example.15 = 115% To convert from a fraction to a decimal. Let's continue by converting decimals to fractions. the fraction 7/8 converts to the decimal 10 . As we can convert from a percentage to a fraction.2438 = 2.49 = 349/100 / 0.76 = 76% / 1.80 / 5/6 = 5 ÷ 6. Simply move the decimal point two places to the right. Imagine that we need to convert the decimal. To convert from a fraction to a percent. Mastering this skill will be helpful to you as you continue in your pursuit of mathematical self-reliance.40 = .833 / 7/8 = 7 ÷ 8. many mathematical ideas are more immediately clear to us if we think in terms of money. 1/2 = 1 ÷ 2. or 25p which is ¼ of a pound or 25%. For example. we can also convert from a fraction to a percentage.95 / Likewise. we can convert 70% to 0. Let's consider some additional examples.4 / 65% = . As we've seen. We will convert it to a fraction by expressing it as 375 thousandths. and then convert the decimal to a percentage. fractions. 25% is equal to .50.037 converts to the fraction 37/1000. All we have done to compute this conversion is to express the five tenths in fraction form.438/10. Now let's convert from a decimal to a percentage.0. There is no need to use a calculator.50. you will convert the fraction to a decimal.Course Name: Maths for Everyday Life Lesson 3: Converting Things As we've seen. with which we are already familiar.175 = 175/1000 / 3.375 is written as a decimal and it is written to the thousandths place. or 0.065.65/ 80% = . Using this method of converting.70 can easily be converted to 7/10. 3.5%. As we've already learned.7% converts to 0. 0. You can use this simple conversion method any time you need to convert from a percentage to a fraction. 0. The decimal 0. and 0. or 375/1000. For example.25 = 25% /. Keep this in mind as we do several more conversions: 40% = . decimals. Move the decimal point two places to the right: 0. you can easily do this conversion in your head or on paper. you divide the numerator by the denominator.

and that is expressed as 66. Let's consider some additional examples: 2/3 converts to 0. 7/12 converts to 0. quarts to cups. you can get the multiplier in one step by just putting the 7 over the 5. 11 . The class is 1/5 boys. What if you want 7 dozen cookies? Well. we have also strengthened our understanding of what these different mathematical expressions mean. By the way. the multiplier is 7/5. Since 7 dozen is 2 dozen more than 5 dozen. That’s what happens when you keep the ratio of cups of flour to dozens of cookies at 2:5. and percentages. Now we have learned simple methods of converting between fractions. liters to gallons. For example. Take note of the common error discussed there: a boy-girl ratio of 1:4 does not mean that the class is 1/4 boys. It’s difficult to overemphasize how important it is to use your common sense when doing math. 13/8 converts to 1. It can really come in handy to be able to at least estimate—conversions from. and that is expressed as 162. because there are 1 boy and 4 girls for every 5 students. that tells you that there are 2 boys for every 3 girls. The same applies to any fraction. decimals. and thus that there are 2 boys for every 5 students and 3 girls for every 5 students. but it should be obvious that regardless of how many cookies you make. cups to ounces. which equals. Proportions are used when you want one ratio to equal another. if the ratio of boys to girls in a classroom is 2 to 3 (or 2:3).3%.5%. 1. and it is easy to convert that to a percentage by moving the decimal point: 87. you’ll need twice as much flour (4 cups). 1 dozen would be 1/5 of a batch. it’s 2/5 of a batch more than 5 dozen. So 7 dozen is 1 2/5 batches.5%. For example. miles to kilometers. let’s say your chocolate chip cookie recipe makes five dozen cookies and calls for two cups of flour. And that tells you that 2/5 of the class is boys and 3/5 is girls. Ratios and Proportions Ratios and proportions are both very closely related to fractions.4. this percentage (25%) or fraction (1/4) of flour needs to remain unchanged.7%. the flour makes up about 25% of the cookie mix. and that is expressed as 58. It’s common sense that if you want to make twice as many cookies (10 dozen). and percentages. This simply guarantees that the percentage or fraction of flour in the cookie mix remains the same. You don’t need to know this when doing a proportion problem. which equals 2 4/5 cups of flour.4) to increase the amount of any other ingredient when you're making 7 dozen cookies instead of 5 dozen. Conversions These are of great practical value.875. In learning how to accomplish these conversions.625. say. or square feet to square yards. as well as how they relate to each other.0. Imagine that in this recipe. Whenever possible. and will help you in any number of ways in your everyday life. Ratios are basically just fractions written a different way. again. decimals. You therefore multiply the 2 cups of flour by 1 2/5.667. You would use this same multiplier (1 2/5 or 1.583.

you get fewer of them. Converting units always involves multiplication or division by the appropriate conversion number from a conversion table. map books.7 kilograms into grams. or 0.05 kilograms—move the imaginary decimal in 50 (50. Conversions Within the Metric System Converting units within the metric system is even easier because you’re usually multiplying or dividing by numbers such as 10." If you convert from a number of miles (a big thing) to the equivalent number of feet (a smaller thing). you can’t go wrong as long as you know whether your answer should be bigger or smaller than the number with which you start. chart. When converting from a small thing to a big thing. you’ll obviously get a greater number of feet than the number of miles with which you started. Since there are obviously more than 12 feet in 12 miles. you must multiply 12 miles by 5280 to obtain the correct answer of 63. Remember: Don’t just memorize this rule. which you can easily do without a calculator.7 three places to the right. One half-pound is how many grams? Solution: 454 grams = 1 pound. If you focus on these simple rules. and you’d divide by 4 to convert 8 quarts into the equivalent number of gallons. you’ll never miss a conversion problem. 100. but you might see a different type of conversion table that lists conversions like 1 quart = 1/4 gallon. reference books and on the web. pay attention to whether your answer is sensible or not. Of course. and 1000. If you want to convert 20 quarts into gallons using the 1/4 conversion number. you’d multiply by 4 to convert 5 gallons into the equivalent number of quarts. you’d have gotten the ridiculous answer of 12 ÷ 5280. you’ll always multiply by the given conversion number to convert from a big unit to a small one. Tables list the equivalences in the standard way. When using such a conversion table (usually in a diary. you get them in diaries. rather than simply following formulas and methods on autopilot. For example. you divide 50 by 1000 for an answer of 0. To convert 50 grams to kilograms. multiplication by 1/4 gives you the sensible answer of 5 gallons. 12 .0023 feet in 12 miles. For example. half that number (227) must be half a pound. and then drop the meaningless zero at the far right and add a zero to the left of the decimal point. let’s say you want to convert 12 miles into feet and 5280 feet = 1 mile. Always ask yourself whether the answer to a problem should be a larger or a smaller number than the number with which you start. Since you’re converting from a big thing (pounds) to a smaller thing (grams). Again. cook books and so on). Your response to this should be: "Of course. you multiply by 1000 to obtain 3700 grams—move the decimal in 3. you get more of them. One of these—multiplication or division—will give you a sensible answer that follows the above rules. you could also have simply reasoned that since 454 grams is 1 pound. so to convert 3.360 feet. if you choose to use a conversion table. Here’s the common sense for doing conversions: When converting from a big thing to a small thing.) three places to the left and fill in the zero (. If you had divided instead of multiplied. you multiply by the conversion number: 1/2 x 454 = 227 grams.050). and divide to convert from a small unit to a big one. 1000 grams = 1 kilogram.bolster your knowledge of maths with your common sense. If you instead divide 20 by 1/4 you’ll get the unrealistic answer of 80 gallons. The other will give you an unrealistic answer.

Note that 1 kilometers = 1000 meters. Since a meter is roughly 3 feet.6 kilometers = 1 mile. 13 . 5280.6 = 12. 20 kilometers is how many miles? Solution: The table gives you the conversion number: 1. (Remember that kilometers are smaller than miles. which is less than the 5280 feet in a mile. so you divide: 20 ÷ 1.79 liters = 1 gallon.10 liters is how many gallons? Solution: 3.5. You’re converting from a small thing (kilometers) to a bigger thing (miles).64 gallons. it turns out that 1 kilometers equals 3280 feet—an easy number to remember because of its coincidental similarity to the number of feet in a mile.) By the way. This time you’re converting from a small thing (liters) to a bigger thing (gallons). so you divide by the table number: 10 ÷ 3.79 = about 2. 1 kilometers or 1000 meters is roughly 3000 feet.

those are the only two possibilities. We will discuss them here. that the chances of it happening are 1-in-2. and the highest possible probability.Course Name: Maths for Everyday Life Lesson 4: What Are the Odds? Probability is also known as "odds" or "chance. A probability of 100% means the thing will happen with absolute certainty. Being a maths person requires familiarity with the six basic probability rules and principles. Halfway up from 0 to 100 is 50%. you’ve got to give 110% effort. you can convert probability percentages into fractions. you can also convert probability percentages into decimals. The probabilities going up from 0% to 100% indicate greater and greater likelihood of some event occurring. or that the chance of rain is 50%. once out of every 2 chances. And that means that. on average. which means that the chances of the event in question occurring are 1-in-10. For instance. equals the number 1. you'd expect the event to occur about once in every 10 chances. equals the number 0.) Likewise. roughly 4 out of every 5 times. Whenever you hear a news report warning that a percentage of people are at risk for some illness. so a probability of 15% is about a 1-in-7 chance. on average. If you buy a lottery ticket. and a probability of 85% is the same as a 0. 50% converts to 50/100 or 1/2. When something has a 50% probability of occurring. it is as likely to occur as to not occur. in the long run. you'd expect the event in question to occur roughly 1/7 of the time or. you are hearing about probability. (Don’t make the common error of concluding that just because something must either occur or not occur. The lowest a probability can be is 0%—which means that the thing in question will definitely not happen. so a 50% probability means that something would occur. or 50%. 80% converts to 80/100 or 8/10 or 4/5. For example. Probability is helpful because it provides a way for us to measure and discuss the uncertainties associated with future events. the only two things that can happen. a probability of 10% is the same as 10/100 or 1/10. It’s the same with probability.85 probability. 14 . In other words. a probability of 25% can be expressed as 0. you will necessarily either win or lose. 15% equals about 1/7. 1 time in every 7 chances. The probability of something occurring can’t be more than 100%. far less than 50%. in the long run. or about half the time. As with any percent problem. you could say the chances are 50-50. The scenarios involving probability are all around us. but it’s literally impossible to give more than 100% effort." That may work for motivating athletes. so a probability of 80% means you'd expect the event in question to occur about 4/5 of the time or. "If you want to win. or about 1/10 of the time. and it dictates our insurance premiums. 100%. The lowest possible probability.25. The Six Rules of Probability Rule 1: A Probability Is Always a Percent from 0% to 100% or a Number from 0 to 1 Coaches love to say things such as. But your chances of winning are far. Finally. So. 0%. probability tells us the comparative dangers of driving versus flying." It would be difficult to go through a single day without encountering a reference to probability.

whether or not you know the formula. so the answer is 3/8 or 37. five pence. their probabilities will always add up to 100%. these are the only two possibilities. If you hear a prediction that Birmingham have a 15% probability of winning against Chelsea in their next game. In other words. if the weather forecast predicts a 70% chance of rain today. so the answer is 3/10 or 30%. (Note that the answer is not 3/7. the answers to all probability problems are based on this simple formula—though few problems are as straightforward as the above example. A closely related idea is that if you consider all the different things that could occur in a given situation.) In a sense. Therefore. let’s say that London has seven football teams in the premier league in any one season. 5p and 10p. then it follows that there’s a 100%-15% (or 85%) probability that Birmingham will lose.3 of the 8 outcomes are winners (bold). what’s the probability of getting one heads and two tails? Solution: There are three ways to "win"—the penny. For example. or ten pence could land heads up—so the numerator in the formula is 3. Total 100% Rule 3: The Basic Probability Formula You are probably familiar with the way this basic idea works. Penny Five pence Ten pence Heads Heads Heads Heads Tails Tails Tails Tails Heads Heads Tails Tails Heads Heads Tails Tails Heads Tails Heads Tails Heads Tails Heads Tails 15 . Here’s a tougher one: If you toss a penny.Rule 2: Probabilities Always Add Up to 100% An event must either happen or not happen. then there must also be a 30% chance that it will not rain. the probability of an event happening plus the probability of it not happening must add up to 100%. It will either rain today or it will not rain today—there is not a third possibility. Here’s a simple example: What’s the probability of drawing a black marble from a jar containing 3 black and 7 white marbles? 3 out of a total of 10 marbles are black. The denominator is 8 because there are the following 8 possible outcomes .5%. The probabilities of each team winning the division (and remember that the probabilities in this context are only somebody’s best guesses) must add up to precisely 100%. One possibility could be: Chelsea 26% Arsenal 22% Spurs 18% West Ham 15% Charlton 8% Fulham 6% Crystal Palace 5%.

There’s no guarantee. nonetheless. there’s the same uncertainty about rain as there would be about tossing a heads with a coin. that exact answer doesn't guarantee anything. But. So. There’s no way to compute a numerator or denominator for such a weather prediction. You're dealing with probability. The prediction of 25% equals 1/4. If there are 3 black marbles and 7 white ones in a jar. or 30%. Its accuracy is limited by the weathercaster’s skills. All probability involves uncertainty. the probability of drawing a black one is exactly 3/10. assuming the rain prediction of 25% is correct. The prediction of 50% is only an estimate. Unlike the 50% chance of tossing a heads—an exact probability—the 50% probability of rain is only the weathercaster’s best educated guess. If the weatherman says there’s a 50% chance of rain tomorrow. But predictions like this involve a second type of uncertainty. for example. the likelihood of rain tomorrow would be the same as the likelihood of drawing a black marble from a jar containing 1 black marble and 3 white ones—which is 1 winning marble out of a total of 4 marbles. you might get lucky and draw a black 5 times in a row. Most predictions about the future involve this second type of uncertainty as well as the uncertainty inherent in every probability problem. which is also a 50% chance. But note the following connection between such a prediction and the marbles-in-the-jar idea. that if you draw a marble 10 times (replacing the marble each time) you'll draw a black 3 times out of 10. the 30% probability is an exact answer that can be precisely computed from the formula. or 8 times out of 10—or you could get unlucky and strike out 10 times in a row. As anyone who’s been to a casino knows. the true probability might be 30% or 70% or anything else. as well as by the current level of sophistication of the science of meteorology. so nothing’s guaranteed. Predictions are different.Probability statements such as "There’s a 25% chance of rain tomorrow" aren’t as cut-and-dried as the above two problems. But you can compute exact answers for the marble and coin problems. Now. granted. The 50% number could be wrong. There’s an important distinction between problems such as the ones involving marbles or coins and problems involving predictions such as the probability of rain or the probability of Manchester United winning the League. 16 .

and that only one person will be offered the job. Call it 50% since you're dealing with estimates. so there remains a 30% probability that the job will be offered to a candidate other than one of these three people. Assuming these estimates are correct. the probabilities must add up to 100%. what’s the probability that both girls will be accepted? Just multiply the probabilities: 70% = 0. let’s consider why simple addition won’t work in this case. For example.7 x 0. and you want to determine the probability of at least one of them happening.. Common sense should also tell you that the answer will be less than 100%. In order to use this rule.7 = 0. if one happens. note that since it is possible that he could be accepted by both. and Tom and Bill each have a 15% probability of being selected. which means that whether or not the first event happens will have no bearing on whether or not the second event happens. We will now learn the method to solve such a problem. or 12. so the probability of tossing 3 heads in a row is.. Tom. If you estimate that his chances of being accepted at each of the two safety colleges is 90%—that’s 90% for each one individually—what is the probability of his being accepted by at least one of the safety colleges? First. because there is a very slim chance that both will reject your son. these are not mutually exclusive events.e. and their tutor estimates that each girl has about a 70% chance of being accepted. if Safety College #1 accepts your son. Rule 5: The Addition Rule for Mutually Exclusive Events When you have two or more mutually exclusive events (i. For example. the probability of tossing a heads is 50% or 1/2. or 49%. Rule 6: What to Do when Events Are Not Mutually Exclusive When you have two or more events that are not mutually exclusive (i. then there is a 70% probability that one of the three will be offered this job.5%. Here’s another one: Let’s say your daughter and her best friend have applied to the same college. you simply add up their individual probabilities. For instance. If you did use the addition rule here. you can’t just add up their individual probabilities like you can with mutually exclusive events. none of the others can happen). you'd obtain an answer that is obviously impossible: 90% + 90% = 180%. the events must be independent. but it’s a bit oversimplified. Let’s say your son is applying to eight colleges. that has no 17 .e. the addition rule does not apply here. you multiply their probabilities. This conveys the basic idea of the multiplication rule. Before showing you how to do these problems. As we have seen.7. and two of them he considers his "safety" colleges. If you estimate that Jane has a 40% probability of being selected. any number of them can occur at the same time). This result should seem reasonable because it’s quite a bit harder to toss 3 heads in a row than to get heads on a single coin toss. and you want to figure the probability that any of them happens. there’s no such thing as a probability greater than 100%. and Bill are all applying for the same job.49. imagine that Jane.Course Name: Maths for Everyday Life Lesson 5: Probability Rules Rule 4: The Multiplication Rule When you know the individual probabilities of two or more things and you want to determine the probability that all of them will occur. and 0. therefore.

Last.) have no memory. things will tend to balance out in the long run. This is a fundamental law of probability. the law of averages does not say that future events (such as coin tosses) will tend to balance out past events. It tells you. but it is because in the long run (1000 tosses in this example). then use the multiplication rule to compute the probability of both things not happening (his not being accepted at either college). The probability of heads (or tails) on any toss is always 50%. Calculate the probability of his not being accepted at each college. heads and tails will tend to balance out. then 0. to determine how many different ways there are to order or rank several items. etc." and thus the probability of tails on the next toss would be something greater than the usual 50%. for instance. Law of Averages There’s a common misconception about probability: Many people believe that the law of averages says that future events will balance out past events so that everything will come out even. It says only that if you start keeping track of results now. The two events are thus independent of each other. The law of averages never looks back in time—period. in fact) end up with between 450 and 550 heads out of 1000 tosses (that’s between 45% and 55%). In other words. that while getting 7 heads out of 10 tosses (70% heads) would not be very unusual. if a coin has landed on heads six or eight times in a row. Multiply: 10% = 0. For example. subtract this probability from 100% for your final answer: Probability of not being accepted at Safety College #1: 100% – 90% = 10%. 700 heads out of 1000 tosses (which is also 70% heads) would be extremely unusual.1 = 0. We're ready to move on to our discussion of the four counting principles.1 x 0. On the other hand. Figuring It Out: The Four Counting Principles You can use these rules to achieve several objectives: to determine the total number of different combinations available given a set of variables. Subtract from 100%: 100% – 1% = 99%.bearing on whether Safety College #2 also accepts him. the past is irrelevant in computing the probability of future events. It’s important to understand what the law of averages says and does not say. which equals 1%. to determine how many different groups of a certain size can be selected 18 . You’d very likely (over 99% of the time. The last 10 or 50 or 1000 coin tosses have no effect whatever on the likelihood of tossing heads or tails on the next toss. Probability of not being accepted at Safety College #2: 100% – 90% = 10%.01. There’s a 99% probability that your son will be accepted by at least one of his two safety schools.1. This may seem surprising to you. this mistaken belief holds that tails would be "overdue. That’s your answer. This tells you that there is a 1% chance of your son being rejected from both schools. Mathematicians often express this idea as dice (or coins. But this is simply not true.

or 12. such as "Mum. the number of different combinations is 3 x 4.from a larger group. and you’ve narrowed your final decision down to 3 entrées and 4 wines. Bill. Amy always gets to go first. 3 entrées. For example. The Fundamental Counting Principle The fundamental counting principle is helpful when you need to determine the total number of different combinations available given a set of variables. If your calculator has a factorial button. Assuming that any wine can be paired with any entrée. or 24. and Diane. you can do this computation in one quick step by 19 . Charlie. The Factorial Rule The factorial rule refers to a simple method of determining how many different ways there are to order or rank several items. How many different ways can you order them from 1 to 4? The answer is 4 factorial—written mathematically as 4!—which equals 4 x 3 x 2 x 1. 4 wines. and so on. Let's begin with the first: the fundamental counting principle. the grand total of all possible outcomes is given by multiplication. imagine that you have four children: Amy. the total number of different dinners you could serve would be 2 x 3 x 4 x 3. and to further determine the ranking of those groups. When you have a number of options or choices followed by a second set of options or choices followed by a third. or 72 dinners. You start with the total number (4 in this case) and multiply it by all of the numbers going down to 1. For example. imagine that you're planning a dinner party. The 12 options might look like this: Fish with Cabernet Merlot Zinfandel Pinot noir Steak with Cabernet Merlot Zinfandel Pinot noir Pasta with Cabernet Merlot Zinfandel Pinot noir If you had to decide among 2 salads." so you want to use all possible orders of your four children equally. and 3 desserts. You don’t want to show any favoritism or hear complaints.

and Diane /Amy. here are the six orders that begin with Amy: Amy. Diane. Charlie. Charlie. n = 7 (the total number) and r = 3 (the subcommittee size). Bill. (By the way. you find this answer by simply punching: This gives you an answer of 35. Bill. Diane. Order means any ranking or designation for the members of the selected group. and Bill There are also six orders beginning with Bill. 20 . If your calculator doesn't have the combinations button. Diane. Bill. For example. Charlie. and Diane/ Amy. Bill. In case you're curious. and Charlie / Amy. and Charlie / Amy. For combination problems. six beginning with Charlie. bringing the total to 24. Charlie. you can use the following formula: For this problem. the factorial symbol ‘!’ has nothing to do with the grammatical mark—whoever came up with this symbol must have had a sense of humor?) The Combinations Rule The combinations rule is helpful when you want to determine how many different groups of a certain size can be selected from a larger group. Plugging 7 into n and 3 into r gives you: Note that this combinations problem involved selecting people to serve on a subcommittee without any concern about their positions or titles on the subcommittee. mathematicians say order doesn't matter.just punching the given number followed by the factorial button. let’s say you're the chairperson of the special events committee at your child’s school. and Bill/ Amy. and six beginning with Diane. How many different subcommittees of three can be selected from a group of seven people? If your calculator has a combinations button. and you have to appoint three members from the seven other committee members to serve on a fund-raising subcommittee. Diane.

80. The median height is the one in the middle (the 6th one counting from the left or from the right). One strength of the mean is that it correlates perfectly with the total. One of the best ways to get a handle on the data about some group—say UK household income. but technically. median and mode will help you to make sense of the different ways there are to express what is typical. for instance—don’t pull the median upward the way they do with the mean. median. or average. in the above example about test scores. the weight of UK men or women.000 in 2003) than what’s typical (somewhere between $35. median.000 in 2003) is a better measure of a "typical" household. 4’2" is the mode because that height occurs more often (three times) than any other height in the list. The mean is another word for the mathematical average that you learned about in school. and it’s important to understand that none is a perfect indicator of what’s typical. (Note that when people use the word "average. A drawback of the mean is that when the data contains some extremely high numbers that aren’t balanced by low numbers (this often happens because no numbers can go below zero). 86. Median U. imagine that a student wants to calculate his classroom grade: He would need to calculate the mean of all the grades he has received. Say a student scores 80. The median of a set of numbers is simply the middle value. the mean gives a pretty good idea of what’s typical. median. And when a set of numbers is relatively balanced around the middle values. For example." they are usually referring to the mean. The mode of a set of data is the value that occurs most frequently. there are three types of average: mean. But what makes the median a good measure in the above income example—not giving full weight to extremely high incomes—becomes a drawback in other cases. is 87. household income (about $41. or the heights of the girls on your daughter’s volleyball team—is to consider the group’s mean. 82.8.000 and $45. and 95. The mean of this student’s test scores. all of the millionaires and billionaires in the US cause the mean US household income to be higher (about $55. the mean is determined by adding up the test scores and then dividing by the number of scores (5). The median score of 82 is not a fair indicator of the student’s performance because it does not give full weight to the perfect score (the median would be the same if the 100 were replaced with an 83). 90. just add the numbers up and divide by the total number of items. For the same list of heights. If his test scores are 80. of a group of numbers.S. and 100 on five tests.Course Name: Maths for Everyday Life Lesson 6: Understanding Statistics How do we know what's typical for a large group of people? An understanding of mean. then. Imagine that the illustration shown below charts the heights of the 11 players on a girls’ volleyball team. and mode. the greater the total test points earned by a student. the higher the student’s mean test score. 82. the mean is often higher than what’s typical.000 in 2003). For instance. For example. An advantage of using the median is that extremely high values—billionaires. The mean. Each has its advantages and disadvantages. and mode. 88. and mode of a group or collection are three different indications of what’s typical or middling for the group. 21 .) To calculate the mean.

99. Note the distinction here between median and mean: The median home price in this scenario is £240. annual rainfall. Three standard deviations (3 times 15 or 45) to the left of 100 is 55.000. and so on. £180. 22 . Understanding the Bell Curve Many sets of data have a shape that resembles a bell like the one shown below. In general.7% of all people.The median is also often used to discuss typical home prices for a given area. That span of IQs constitutes 99.000.000.7% of all values are within three standard deviations of the middle value. As you might guess from the symmetry of this so-called "bell curve. IQ scores.000. £290.000. The standard deviation for IQs is 15. the mode is often meaningless. the larger the set of numbers. and three to the right is 145. the median gives a much better idea of what's typical. you get about 68 percent of the total area under the bell. This is instructive because it tells us that a one-child household is the most common. Bell curves are another way of interpreting data. for example. and £4. £220. Much of the ordinary data that we want to understand can be expressed in this way. and that tells you that about 68 percent of all people have IQs between 85 and 115.000. For any "normal" distribution ("normal" in this context means the same thing as bell-shaped).000. If you go 15 to the left from 100 (to 85) and 15 to the right from 100 (to 115). Understanding the bell curve and its standard deviation will enhance your comprehension of data such as. the weights of newborn babies. £210. 95% of all values are within two standard deviations of the middle value. There is no question that in this case. In fact. Two standard deviations for IQs would be 2 times 15. All sets of data that have this bell shape follow this standard deviation scheme: 68% of all values are within one standard deviation of the middle value. This number (one child) gives a better idea of what the typical household is like than the mean number of children would." the mean. the heights of women or men. it tells you what is most common. Understanding the strengths and weaknesses of the mean.000. and the mode will give you a better grasp of the averages and medians of various things that are reported so often in the news.000.000. For very small sets of numbers. you get about 95 percent of all people. the mode for the number of children is one child. If you go 30 to the left from 100 (down to 70) and 30 to the right (up to 130). the standard deviation indicates how tightly the values are bunched near the middle value. the mode is therefore exactly what many people would think of as most typical. A strength of the mode is that. by definition. Imagine that 11 houses have sold in one town in a given year. median. For some sets of data. £350. £375.000. £240. the median. or the date of the first frost in a given city. and that the sale prices were £50. or 30. £150.000. Among families with children living at home. but the mean home price is £620.000. £250. the more telling the mode will be.000.500. there is nothing typical at all about the mean price of £620. and mode of such data sets are all the same and are all equal to the value at the centre of the bell.

Let’s say four different pollsters in a town wanted to measure the level of public support for building a new soccer stadium. In the example above. in fact. Can you trust the results? And what does the margin of error tell you? While poll and survey results are often informative — they are often imperfect and sometimes just plain wrong. #3 and #4 because of the way the questions are worded. the 50% and the 45%. it is possible to feel supportive of the idea of a soccer stadium. and yet not believe that other 23 . Even if the poll had shown Candidate A ahead of Candidate B. It’s not guaranteed. it’s often difficult to determine whether a survey or poll was done properly. the margin of error would be ± 3%. Another limitation of polls concerns the way poll or survey questions are worded. Someone who answers "Yes" in Poll #1 might answer "No" in Polls #2. 52% to 44%—thus satisfying the margin of error because the difference (8%) is larger than twice the margin of error (2 x 3% or 6%)—what newscasters never tell you is that satisfying the margin of error doesn't mean the poll result is 100% guaranteed. there’s still a very small chance that the poll results are wrong. Say a political poll shows Candidate A leading Candidate B. The maths is beyond the scope of this course. But the margin of error must be applied to both numbers.Course Name: Maths for Everyday Life Lesson 7: Understanding Surveys Polls. Surveys. 52% of those polled favored Candidate A with a 3% margin of error. Below are four possible polls and their results: Poll #1: Are you in favor of building a new soccer stadium in our town? Yes: 65% No: 35% Poll #2: Are you in favor of building a new soccer stadium in our town if it means decreased funding for other public projects? Yes: 40% No: 60% Poll #3: Do you agree that building a new soccer stadium is the top priority for our town? Yes: 35% No: 65% Poll #4: Do you agree that your taxes should be significantly raised to support a new soccer stadium? Yes: 25% No: 75% Note that the way a poll question is worded can have a big effect on the outcome. Since 50% is 5% more than 45% and the margin of error is only ± 3%. 50% to 45% with 5% undecided. The poll is. unfortunately. That means that the support for Candidate A in the population as a whole is probably somewhere between 49% (52% – 3%) and 55% (52% + 3%)—but only 95% of the time. If 1000 people were polled. you might think that Candidate A is definitely ahead of Candidate B. and Their Limitations It would be difficult to go through a week without hearing or reading about the results of some poll or survey. And. Let’s first look at the margin of error. but just be aware that even when the margin of error is satisfied. inconclusive—the race would be called a statistical dead heat—because 50% – 3% (or 47%) is less than 45% + 3% (or 48%).

34. Consider the first and third polls. Say you read an article bemoaning the huge salaries earned by finance executives. This tells you that the value of the pound shrunk by a factor of 2.340.000.4—that’s about 2. "Are you willing to pay £10 more in taxes per year to support a new stadium?" the results would certainly have been different.000.000. and to call the article sloppy would be kind. 24 .projects should suffer for it or that taxes should be raised significantly. Another way a survey can be flawed comes up a lot in the informal surveys you see in magazines and hear on news shows that report data such as. Perhaps no shy people responded to the survey because the questions were too personal. and the results could be used to bolster an argument either in support of or in opposition to it. Since polls are often conducted or paid for by groups that want a certain result.000 today—up from £1. The four polls show four different levels of support for this project. the CPI is about 193. the polls are often designed to achieve the desired result. check to see whether the author of the report corrected for inflation. Perhaps people who responded didn’t answer the questions truthfully.000 would give you the average finance executive salary for 1980 in 2004 pounds. These questions are very different. the report is seriously flawed. this comparison is meaningless. Errors and misconceptions abound regard statistics figures we'll consider two of the most important errors that you should watch out for. Look up the CPI for 1980—that’s 82.34 = £2.000. If he or she did not. For 2004. Had Poll #4 asked instead." There are so many possible flaws in such a survey that it’s difficult to know whether the 30% result is even close to the true percentage. by this factor: £1.000 x 2. With many informal surveys. people may have complicated opinions.000 to £2.000. Imagine how people would respond to the question. and polls—which reduce subjects to simple Yes-or-No questions—may be designed to manipulate a response.000 amount has not been corrected for inflation. that’s not a valid cross-section of the population. The author states that the average finance executive earns £2. did the magazine survey only its readership? If so.000 in 1980 (these numbers are invented for the purposes of this lecture). A person might feel strongly supportive of a new soccer stadium.340.000. Here’s how: Look up or estimate the Consumer Price Index (CPI) for the current year. If the £1. The Effect of Inflation Whenever you see a report that compares an amount of money today to an amount of money from a number of years ago. there isn’t even an attempt to reduce potential biases. Multiply the 1980 amount.000.500. Let’s assume that the £1. You can do the correcting yourself.34 between 1980 and 2004. So take such results with a grain of salt. Divide 193 by 82. It can be difficult even for professional statisticians to eliminate all of the things that might skew the results of a survey.000. This answer of £2. £1. "30% of those who responded to the survey do such and such. "Are you ecstatic about paying a bigger tax bill?" Who would respond "Yes" to such a question? The obvious response of "No" to this question wouldn't necessarily mean that the person polled would object to a small tax increase for some good purpose.4. and it would show that the average finance executive salary increase from 1980 to 2004 was actually very little: from £2.000 amount from 1980 has not been corrected for inflation. For example. and yet at the same time might not believe that it should be the town's top priority.340. As we have seen from this example.500.

of course.What’s important to remember is that to make valid comparisons between pound amounts from different years. Since it seems possible that something about television-watching could cause aggressive behavior. by itself. If this were true. the more aggressive they are. in fact. the more violent crime there is. is that cities with more people have both more hospitals and more crime. because it suggests that a greater number of hospitals causes crime. the less they tend to exercise. then it would be possible that television-watching. it’s easy to jump to the conclusion that there is a causal connection even when none has been established. despite the correlation. comparisons are virtually meaningless. and that it’s the lack of exercise that causes the aggressive behavior. it’s very easy to jump to the conclusion that causality has been shown. causes no increase in aggressive behavior. The trouble is that when you hear about some study that shows a correlation where a causal connection seems plausible or likely. imagine that some new study showed that the more television children watch." This is. though. the past amounts must be corrected for inflation. The explanation. Causation Just because two things go hand in hand doesn't mean one of them causes the other. But the explanation might instead be that the more television children watch. This is obvious when you consider the absurd statement. "The more hospitals a city has. It's absurd. Correlation vs. a true correlation. For example. If they are not. 25 .

26%.) £51 is approx 30% of £167. Now that you know that 10% of the original price is approximately £17.95 is rounded up to £170. Note that if you had wanted to compute a 30% mark up on a product that costs £167. Is this one of the reasons that you are working to improve your math skills? You will learn two easy methods for estimating discounted and marked-up prices. You can also use Method One to compute discounts (or mark ups) of 5%. you could estimate this as £170 + £50 = £220.00.50.95. First. 15%. you will learn to calculate the math involved in a discount of 15% or 40%. To determine the actual sale price. There is a simple way to do this. In this way.95. For instance. Round 26 . Add £8. you will determine the price when £121. For example. Both methods are easy to use. If you prefer to use the first method. you would add instead of subtract: £168 + £50 = £218.95. Many people find the first method faster. We already know how to determine 30% of £167. 40%. the second method is more accurate. and so on.95 is marked up by 18%. The approximate sale price is £118. Compute 10% of the purchase price: 10% of £170. if you prefer the second method.00. and you may choose to use one or the other depending on the percentage with which you’re dealing. and the item is discounted by 30%. if it is easier.00 is £17.Course Name: Maths for Everyday Life Lesson 8: Is the Price Right? A knowledge of mathematics will help you to manage your finances—at home and abroad—more effectively.95 is approximately £17. Round that to £60 and subtract that from £168 for your final answer: £108. we wanted to figure out 30% of £170. and we need to add an additional 5% to that figure. The first method is designed for you to use when you need to figure out discounts and mark ups (increases) that are multiples of 5. round off the purchase price to the nearest £5 or £10.50. subtract £51 from £167. Multiply $17 x 3 and the total is £51. and so on. for a total of £51. It might be easier for you to now round £167.95 product is 35%. You now know that the discount is approximately £51 on this purchase. 30%. plus 3 x £7. you will learn to calculate the math involved in a price that has a 22% mark up. (You could also calculate it as 3 x £10. 35%. In this example. In the example given above. you can use it to determine a percentage that is not in a multiple of 5 (such as a 22% mark up). We determined earlier that 10% of £167. half of that (or 5%) is £8.Imagine that you are considering a purchase of a product with a sales tag of £167. by multiplying.50 (or 5%) to the previously determined £51 (or 30%) and you know that 35% of £167.95. The second method is intended for you to use when you need to figure out all other percents that are not multiples of 5. 25%.) Now you know how to use Method One to compute discounts (and mark ups) in multiples of 10. Method One . We know that 10% is £17. as long as rounding to 20% and figuring the 20% amount is a good enough estimate for your purposes. you can use it for all types of percent problems. or a markup of 20% or 35%. Imagine that the discount of the £167.95 is approximately £59. £167. Method One gives you an easy way to compute that discount. or £30. Method Two will teach you to determine discounts and mark ups when the percentage is not a multiple of 5. and so on. you can easily compute 20%. 22%.95. or £21. We will now compute 5% by figuring that it is half of 10%. and then subtract £50. (Or. On the other hand. such as 17%.95 up to £168. but for percents that are not in multiples of 5. you will be able to easily compute percentages of any amount.

you always want to use the larger of the two numbers—the one that’s more than 1. Add that to £18. say $120. Just multiply 18 x £1 (or £18) + 18 x 20p.199? Use the steps as shown above: £2. and the total is £21. just enter the new exchange rate into your calculator and forget about it.70 yen number. But you don’t have to worry about that. One of these numbers will always be more than 1 and the other will always be less than 1. instead.199. note that exchange rates can be written in two ways: the number of the foreign currency in one pound.£480 = £1720. Using Method Two. you want to convert from pounds to yen. And £122 + £21. so you can see that Method Two produced an estimate that was very close to the actual marked-up price).95 to the nearest pound. But this should go without saying: yen. Likewise. For example. This is probably easier to do in your head than you think. Now imagine that you're in Switzerland.60.) This will give you the equivalent pound amount. Now determine 1% of the amount from Step 1: 1% of £120. the Times gave the following yen-to-pound exchange rates: Yen in 1 Dollar Dollars in 1 Yen 108. The beauty of this method is that it works the same regardless of what country you're in. In this instance.50 = £143. we are trying to determine 18%. Enter this in your calculator and press the memory or store button. you take out your calculator and press: (You may have to press slightly different buttons depending on your calculator model. Add this to the original price.£121. And when the exchange rate is extreme—say you see a coat in Japan with a 37. in the above example. you'd use the 108. When you travel to a second or third or fourth country. First. then.60.00. you can easily figure out sale prices and mark ups.50. is £484.90. You'll know which one to do because no matter where you are. For instance.70 0. £22 x 22 = £484. subtract that discount from the original price. That will give you the other exchange rate (the one that’s more than 1).199 rounds up to £2. What is 22% of £2.20 by 18. Imagine that this morning. To figure out the sale price.300 yen price tag. in the problem outlined above.20. where one franc is worth more than one pound. Now when you see an item with a 34. imagine that you need to determine a 22% discount on a product that costs £2. euros. Let’s call it £21.300 yen into the fewer number of pounds and multiplication to convert £120 into the greater number of yen.000 yen price tag—there can be a tendency to spend as if you're using play money. which is £122. For example.200 is £22. Use multiplication to make an amount bigger and division to make an amount smaller. press: Voilà! You’ve got the equivalent yen amount. Exchange rates fluctuate daily. This stores the exchange rate in your calculator’s memory. If you happen to see only the exchange rate that’s less than 1. Multiply the 1% amount by the percent that you want to compute. and the number of pounds in one unit of the foreign currency. we could use Method Two to determine a markup price by simply using addition instead of subtraction.00920 Let’s use these yen exchange rates to illustrate how you can know what things cost in dollars when you're shopping abroad. If. (The exact answer is £143. 1% of £2. dollars. It may be easier to round that purchase price of £121. The only thing you have to pay attention to is whether you want to make an amount bigger or smaller. just take out your calculator and divide 1 by this number. which is £3. The discount. £484 rounds down to £480.200. For the method discussed below. £2200 . and the like are absolutely not play money.00 is £1.95 down to £120. your common sense will tell you whether the 27 . Simply multiply £1. and regardless of the exchange rate. Foreign currency can sometimes look and feel like play money. If you're travelling in Japan. we used division to convert 34. Use an easy way to figure out 18 x 20p. the conversions work the opposite way: division converts pounds to francs and multiplication converts francs to pounds.50.

28 .answer to the conversion you're doing should be larger or smaller than the amount with which you started.

Step Two suggests that you don’t incur fees by withdrawing more than you have in your account. such as debit and ATM cards and online banking. there are seven steps only if you're starting the entire balancing process from scratch. Moreover. Now. Not so many years ago. And if you are able to avoid overdraft fees. you may have arranged to pay your utility bills by direct debit. and the chore of balancing the books was more difficult than it is today. we will cover three steps you can take to get your finances in order and save money: balancing your accounts. or record. this will be the new tool that you use from now on to keep your checking account in order. a good way of evening out bills. ATM withdrawals and fees. you'll really come out ahead. many people use computer programs to help them balance their accounts. Once you make a habit of reconciling your balance. for example. entering the balance from your monthly statement. This topic is of great value to everyone who needs to learn how to work with accounts effectively. All three are easy to do—all you have to do is to make up your mind to do them. The financial rewards can be substantial. Step Five asks you to read your monthly statement and compare it to your own record. but there’s really nothing to it. if you need to do no more than reconcile your records with the bank statement. Most people today choose helpful tools. This sounds obvious. Regardless of any poor habits you may have had in the past. Reconciling means bringing the two documents into agreement. Turn over a new leaf and make this a habit. and buying less insurance. Neglecting this task can lead to paying unnecessary overdraft fees. Step One invites you to begin fresh by starting a new register. it’s even easier. Here we will discuss a few of the important points in the seven-step approach. all checks were paper. you'll enjoy the peace of mind that comes from knowing that your finances are in order. It is important to track those expenditures so that you don’t make costly overdraft errors. Step Four recommends using a calculator to figure your balance after every five or 10 transactions. If you’ve found it difficult to keep track of your account in the past. Unless your bank account is in order and you are already in the habit of reconciling the balance regularly. As long as you know you’ve got enough money in your account. keeping your books balanced will likely save you money in the long run simply because of your new organized and disciplined attitude about money. as well as the bank’s automated phone service) may make the difference for you. adding to your record items that appear on your statement but not on your record. and the checks you write. and that may be an idea for you to consider. When the monthly statement 29 . This is the efficient and accurate way to compute your balance. there's no reason to do it more often. thanks to new innovations in banking. Don’t forget to track any automatic withdrawals that are made on your account. making use of new banking tools (such as online bill paying and account tracking. you need to review this section. (By the way. paying off your credit cards.) This process may seem a bit tedious at first.Course Name: Maths for Everyday Life Lesson 9: Personal Finances In this lesson. You'll be glad you did. to make checking easier and reconcile your records with the bank statements. Step Three asks you to make a habit of entering into your record all of your checking account transactions. including debit card purchases. and it is easier now than it used to be.

purchased on a 20% APR credit card who then carries the card’s maximum balance of £5000 for 30 years without paying down the balance will find her outfit costs her £36. The example describes a realistic scenario. and add or subtract them from your statement balance.000. a woman with a £625 outfit.comes in the mail. Paying off the balance may seem overwhelming in the beginning. All you have to do is tighten your belt a little bit in the short term and make a commitment to yourself to forego just a little spending. If it does. Notice any fees that are being charged by your bank. You will make note of any debits and credits from your own record that don’t appear on your statement. you may decide not to worry about it further. the true cost of the outfit would be "only" about £15. although many people do not adequately understand them. This exercise may also help you to track your spending and develop an awareness of where your discretionary income is going. if the discrepancy is large or troubling to you.750. Place a star next to any charges on your statement that were non-essential or luxury items. This exercise can be a helpful tool as you move forward and anticipate future purchases. Take a moment now to think about your credit card spending. However. there's hardly anything you could do—short of winning the lottery—that will so significantly improve your financial future for so little effort as making up your mind to gradually pay down your credit card balances.750 amount is computed in future pounds. If it doesn't. If you have never taken the time to carefully review your statement. but it will be very helpful for you to get into the habit of reading it. For example. it may be your habit to file it away. not today’s pounds. and pay off the credit card debt. Granted. But no matter how you look at it. understanding this concept and what it implies is the most important thing for you to learn in this course. proceed to Step Seven. or clothes that you really didn’t need. impulse purchases. this example ignores inflation. carrying credit card debt month after month can have devastating financial consequences. You may choose to just accept it and make the necessary "fudge" correction. 30 . the £36. and if the discrepancy is a small one. You will save yourself a great deal in the long term. but many people have carried a credit card balance for the past 10 years. sit down in a quiet place and review your credit card statements for the past three months. such as treats. If you carry a credit card balance month after month without paying down the balance. The Cost of Buying on Credit If you carry a balance on a credit card month after month without paying down the balance. This illustration drives home the financial consequences of credit card spending are very serious. but it is a manageable task if you make a commitment and stick to it. For dramatic effect. if you get the same discrepancy a second time. Nothing else even comes close in terms of the long-term consequences for your life. you're done. and make sure that you understand why you are being charged. If you take inflation into account.000 or £20. and that is a third of the way to 30 years. If you are carrying credit card debt. Once you become more adept at reconciling your books. This corrected statement balance should agree with the balance in your own record. 30 years is a long time to carry a credit card balance. there will probably not be many surprises of this sort. Step Six is to reconcile your own record with your monthly bank statement. Step Seven asks you to check your work on Step Six. you may choose to call your bank and ask for help in explaining the discrepancy. this may be a revelation to you.

(The best way to do this is to keep separate ledgers: Keep one for items such as consumer electronics. You might never recover financially from the loss. you'd be out of luck. People who create.) Subtract from this running total the costs that you incur because of the insurance you decided not to buy. and as long as you feel comfortable with the amount). Keep a running total of the amount that you saved by not buying such insurance. glasses. (the higher the better. It doesn't. The bottom line is that you should not buy insurance to protect against losses you could afford to pay for yourself. Imagine that there was no such thing as homeowner’s insurance. They understand how insurance works for things like their houses. To neglect to insure your home would be foolish and irresponsible. but one that’s misapplied when purchasing a VCR. a good idea. and compute how much you will end up paying for that £100 item. Think about £100 spent today on a luxury item purchased on credit. This applies to items such as consumer electronics. contact lenses. it will be helpful to curtail that practice as you begin to pay off the balance. Every time you're considering buying insurance for minor purchases. Don’t buy it. Millions are wasted insuring small-value items. But with the great invention of insurance. This is the mistake that many. Record the amount that you saved on insurance. don’t buy that insurance. items being mailed. This is what insurance is for: to protect you from devastating financial losses that you could not afford to suffer. thousands of homeowners are able. such as when you are buying a new DVD player. Ideally. and do the maths: Compute how long it will take you to pay off that £100 purchase. You may choose to try the following exercise. Insurance is a great thing. We couldn't get along without it. just because it makes sense to insure big items. and so on. One reason they can afford to offer such good bargains is that they know that many customers will insure their purchased items (often at the checkout).If you are compounding your long-term credit card debt with unnecessary spending. as long as you know you could afford to repair your car if you get into an accident. one for car insurance." The amount you save can be substantial. to pool their resources. and predictable expenses. Record the amount that you save each time you pay your premiums. say. again. when calamity strikes the unlucky few. Then call your car insurance agent. market. To insure high value items like your home is. those impulse purchases and treats become much less appealing. perhaps you might never be able to afford to buy another house. and increase your excess rate from. it doesn't follow that the same logic applies to small items. For many people. the vast majority of people who try this experiment will enjoy watching their balance move further and further into the "black. But. The VCR or computer that was such a great deal becomes a lousy deal as soon as you add on the insurance. cell phones. and what a huge profit the company makes from them." which is a perfectly natural and logical desire when purchasing a home. and they think the same logic works for insuring things like their phones and VCRs. instead of just 31 . Think of those huge consumer electronics stores that sell electronics very cheaply. many people make. £200 to $500. once they fully comprehend the damage they are doing to their financial future by spending on credit. contact lenses. this financial pool can be drawn upon to rebuild their houses. in a sense. If your house were destroyed by fire. and keep track of the policies that you didn’t buy. you should put away the money you’ve saved. etc. glasses. and sell insurance for such small items are part of the problem: They take advantage of the desire most people have to feel "safe. While your ledger may dip into the "red" now and then. It must be a challenge for some of the salespeople to keep a straight face when selling these policies because they know what a bad deal the policies are for customers.

for each of the next 25 years.58. that’s £216. say. Now that you’ve completed this course. This is the estimated growth rate of your investments after inflation and taxes are taken into account. This product—73. or something in between. If your VCR does break. the following step is required. like the deposits. you first have to pick an interest rate between 3% and 6%. that’s 73. each year. the more money will go into your account instead of into your insurance company’s pocket. look up the interest rates Table for 4% and 20 years (the number of years of withdrawals). And that’s the important point to remember. subsequent deposits should grow slightly to keep pace with inflation. Next. that’s 43.930 of today’s pounds for 20 years of retirement. 216. the value of your retirement account in today’s pounds when you retire in 25 years. and you can perform mathematical tasks with assurance. In a nutshell. That equivalent amount should allow you to purchase. Let’s use 4% for the following problem. look up an interest rate table for 4% and 25 years (the number of years of deposits). Lastly.930 in today’s money.5. There is one slight complication with this method. which takes both inflation and taxes into account. the following inexact method. Let’s say you think you can afford to save £5000 per year until you retire in 25 years. the equivalent of saving £5000 this year. The higher the excess you can comfortably risk having to pay. may be as good as any more precise method for giving you an estimate of how your investments will grow and what you’ll be able to withdraw during your retirement. remember that the answer of £15. To use this shortcut method.930 is in today’s dollars. This shouldn’t be hard to do. So. this account will likely grow. 6% for an optimistic estimate. You will be able to move forward with a new ability to compute figures.930—is the value in today’s pounds of your annual withdrawals during retirement. roughly what you can buy with £15.550. and that you will then draw down these savings for the following 20 years. and navigate through the mathematical world. you will be able to buy yourself a new VCR using the money in your self-insurance savings. What will your withdrawals be worth in today’s pounds? Here’s what you do. Inflation/ Taxes/ Investment Since no one can predict what the inflation rate will be in the future or what the tax laws will be. This way you won’t spend the money on something else. you'll be able to withdraw the equivalent of £15. First. Since you think you can afford to save £5000 per year. Use 3% for a conservative estimate. Your actual withdrawals will be quite a bit larger. your car insurance excess even higher.930 today. manage your finances. you have a strong understanding of the fundamentals that you need to be mathematically aware in your everyday life.31. because each deposit will feel about the same as putting away £5000 today.58 x 216. will grow slightly each year to keep pace with inflation. Once it grows large enough. Now multiply that by the number of thousands you begin with at retirement. you might feel comfortable raising.5. Congratulations! 32 . Results that aren’t in today’s pounds like this aren’t realistic or practical.tracking it. consider opening a special "self-insurance" savings account. Because the method takes inflation into account. Multiply this by your annual deposit of £5000. Over time. But each withdrawal will be worth approximately £15. this shortcut method tells you that if you can afford to save. and the withdrawals. after your first deposit of £5000. you should be able to save £5000 in today’s pounds per year. or £15.

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