Money and Financial Maths
39 free practice questions with explanations
PassNova has 39 free Functional Skills Maths L2 practice questions on Money and Financial Maths, each with a clear explanation. Practise them in the browser with instant feedback — 100% free, no sign-up, on any device. Updated for 2026.
Money and Financial Maths: example questions & answers
39 worked examples with answers and explanations below. Practise them in the browser with instant feedback on every answer.
A bank account earns 2% interest per year on £500. How much interest is earned in 1 year?
- A£20
- B£5
- C£2
- D£10✓
Answer: Interest = 2% of £500 = 0.02 × £500 = £10.
A worker earns £1,500 gross. Tax and deductions total £300. What is the net pay?
- A£1,400
- B£1,800
- C£1,200✓
- D£800
Answer: Net pay = £1,500 - £300 = £1,200.
A budget allows £400 for food. If spent so far is £280, how much remains?
- A£400
- B£120✓
- C£220
- D£280
Answer: Remaining = £400 - £280 = £120.
An item costs £75. A 20% discount is applied. What is the final price?
- A£55
- B£45
- C£70
- D£60✓
Answer: Discount = 20% of £75 = £15. Final price = £75 - £15 = £60.
A loan of £2,000 has 5% interest. How much interest is owed?
- A£100✓
- B£500
- C£200
- D£50
Answer: Interest = 5% of £2,000 = 0.05 × £2,000 = £100.
A mobile phone contract costs £35 per month. What is the annual cost?
- A£420✓
- B£105
- C£350
- D£35
Answer: Annual cost = £35 × 12 = £420.
A savings account pays 3% interest per year. How much interest is earned on £1,000?
- A£30✓
- B£3,000
- C£3
- D£300
Answer: Interest = 3% of £1,000 = 0.03 × £1,000 = £30.
A utility bill is £250 per quarter. What is the annual cost?
- A£500
- B£250
- C£750
- D£1,000✓
Answer: Annual cost = £250 × 4 = £1,000.
A retailer buys an item for £20. They mark it up by 50%. What is the selling price?
- A£30✓
- B£40
- C£25
- D£20
Answer: Mark up = 50% of £20 = £10. Selling price = £20 + £10 = £30.
A salary is £24,000 per year. How much is earned per month?
- A£3,000
- B£1,000
- C£1,500
- D£2,000✓
Answer: Monthly salary = £24,000 ÷ 12 = £2,000.
A deposit of £100 earns 4% simple interest per year. How much interest is earned over 2 years?
- A£4
- B£104
- C£8✓
- D£80
Answer: Simple interest = 4% of £100 = £4 each year. Over 2 years = £4 × 2 = £8.
A car costs £15,000. A buyer pays a 10% deposit. How much is the deposit?
- A£1,000
- B£1,500✓
- C£5,000
- D£13,500
Answer: Deposit = 10% of £15,000 = £1,500.
A bill is split equally among 5 people. The total bill is £45. How much does each person pay?
- A£9✓
- B£8
- C£15
- D£5
Answer: Each person pays = £45 ÷ 5 = £9.
Currency exchange: 1 GBP = 1.20 USD. How many USD for £100?
- A60
- B83.33
- C100
- D120✓
Answer: USD = £100 × 1.20 = 120 USD.
A tax rate is 20%. How much tax is paid on £250?
- A£20
- B£50✓
- C£80
- D£40
Answer: Tax = 20% of £250 = 0.20 × £250 = £50.
A subscription costs £9.99 per month. What is the annual cost?
- A£119.88✓
- B£199.80
- C£99.99
- D£129.99
Answer: Annual cost = £9.99 × 12 = £119.88.
A student has £50. They spend £15. How much is left?
- A£15
- B£65
- C£25
- D£35✓
Answer: Remaining = £50 - £15 = £35.
A credit card statement shows purchases of £45, £30, and £25. What is the total?
- A£75
- B£100✓
- C£110
- D£95
Answer: Total = £45 + £30 + £25 = £100.
A gym membership is £30 per month, but a yearly plan costs £300. How much is saved by choosing the yearly plan?
- A£300
- B£30
- C£60✓
- D£360
Answer: Monthly cost for 12 months = £30 × 12 = £360. Saving = £360 - £300 = £60.
An invoice shows a subtotal of £200. VAT is added at 20%. What is the total?
- A£260
- B£250
- C£240✓
- D£220
Answer: VAT = 20% of £200 = 0.20 × £200 = £40. Total = £200 + £40 = £240.
A wage increase of 5% is applied to a £400 weekly wage. What is the new wage?
- A£20
- B£405
- C£380
- D£420✓
Answer: Increase = 5% of £400 = £20. New wage = £400 + £20 = £420.
A house is insured for £150,000. The annual premium is 0.4% of the value. What is the annual premium?
- A£150
- B£600✓
- C£60
- D£40
Answer: Premium = 0.4% of £150,000 = 0.004 × £150,000 = £600.
A budget has £500 allocated. If £350 is spent, what percentage remains?
- A30%✓
- B35%
- C50%
- D40%
Answer: Remaining = £500 - £350 = £150. Percentage = (150/500) × 100 = 30%.
An item is priced at £80. It is on sale for 25% off. What is the sale price?
- A£55
- B£60✓
- C£20
- D£75
Answer: Discount = 25% of £80 = £20. Sale price = £80 - £20 = £60.
A savings goal is £2,000. So far, £800 has been saved. How much more is needed?
- A£2,800
- B£1,800
- C£800
- D£1,200✓
Answer: More needed = £2,000 - £800 = £1,200.
An investment of £1,000 grows by 10%. What is the new value?
- A£1,100✓
- B£100
- C£900
- D£1,010
Answer: Growth = 10% of £1,000 = £100. New value = £1,000 + £100 = £1,100.
A bill was £120. A 15% tip is added. What is the final amount?
- A£135
- B£138✓
- C£102
- D£18
Answer: Tip = 15% of £120 = £18. Final amount = £120 + £18 = £138.
Petrol costs £1.40 per litre. How much does 40 litres cost?
- A£40
- B£42
- C£56✓
- D£140
Answer: Total cost = £1.40 × 40 = £56.
A shop offers a BOGOF (buy one get one free) deal. The original price is £10. What is the cost for 2 items?
- A£20
- B£5
- C£15
- D£10✓
Answer: BOGOF means you pay for 1 and get 1 free. Cost = £10 for 2 items.
A payslip shows gross pay £2,500, tax £400, and pension £100. What is the net pay?
- A£2,400
- B£2,100
- C£1,600
- D£2,000✓
Answer: Net pay = £2,500 - £400 - £100 = £2,000.
£4,000 is paid into a savings account that pays 3% compound interest a year. How much is in the account after 2 years?
- A£4,240.00
- B£4,120.00
- C£4,360.00
- D£4,243.60✓
Answer: The balance is multiplied by 1.03 for each year: £4,000 × 1.03 × 1.03 = £4,243.60.
£2,500 is invested at 4% compound interest a year. What is it worth after 3 years?
- A£2,800.00
- B£2,704.00
- C£3,000.00
- D£2,812.16✓
Answer: The balance is multiplied by 1.04 three times: £2,500 × 1.04 × 1.04 × 1.04 = £2,812.16.
£8,000 is saved for 2 years at 2.5% compound interest a year. How much interest is earned altogether?
- A£400.00
- B£405.00✓
- C£200.00
- D£8,405.00
Answer: The balance after 2 years is £8,000 × 1.025 × 1.025, and taking the original £8,000 off that balance leaves interest of £405.00.
£1,000 is invested for 2 years at 10% a year. How much more interest does compound interest earn than simple interest over those 2 years?
- A£10✓
- B£21
- C£100
- D£1
Answer: Simple interest gives 2 lots of 10% of £1,000, which is £200 of interest. Compound interest gives £1,000 × 1.1 × 1.1 = £1,210, which is £210 of interest, so the difference is £10.
A van bought for £18,000 loses 20% of its value each year. What is it worth after 2 years?
- A£14,400
- B£10,800
- C£11,520✓
- D£7,200
Answer: The van keeps 80% of its value each year: £18,000 × 0.8 × 0.8 = £11,520.
A commercial coffee machine costing £640 depreciates by 25% a year. What will it be worth in 3 years' time?
- A£480
- B£270✓
- C£360
- D£160
Answer: The machine keeps 75% of its value each year: £640 × 0.75 × 0.75 × 0.75 = £270.
A car is worth £9,000 today, after losing 10% of its value over the past year. What was it worth a year ago?
- A£9,900
- B£8,100
- C£10,000✓
- D£10,800
Answer: £9,000 is 90% of last year's value, so last year's value is £9,000 ÷ 0.9 = £10,000.
A loan of £3,000 is charged simple interest at 6% a year for 4 years. How much interest is owed altogether?
- A£180
- B£787.43
- C£3,720
- D£720✓
Answer: Simple interest is charged on the original amount only, so it is 4 lots of 6%, which is 24% of £3,000 = £720.
A saver is comparing simple and compound interest on the same deposit at the same rate. Which statement is correct?
- ACompound interest pays interest on the interest already earned, so it grows faster✓
- BSimple interest is worked out each year on the balance including the interest added
- CThe two methods give exactly the same balance after the first two years have passed
- DCompound interest has to be worked out monthly, while simple interest is yearly
Answer: With compound interest each year's interest is added to the balance and then earns interest itself, so a compound account grows faster than a simple interest account paying the same rate.