NZ Currency and Swedish Rounding
In NZ, there are no pennies or 1 cent coins. Coins in NZ come in 10 cent, 20 cent, 50 cent, 1 dollar, and 2 dollar varieties. Bills come in 5, 10, and 20 dollar denominations. I assume there are larger bills, but I've never seen them. ;)
But, when you go to the store, prices don't all end in 0. So if something is advertised as $19.99, it's really $20.00 ... but only if you are paying cash. If you pay by credit card or EFTPOS (the NZ equivalent of the debit card), then you pay $19.99.
To determine the cash price, NZ has generally adopted what is referred to as Swedish Rounding. (Sorry, but unlike other things described by the word 'Swedish', this isn't particularly exciting.) 'I don't think this is official government policy, but rather just the accepted practice. Under Swedish Rounding, cash transactions for totals ending in 1, 2, 3, 4, or 5 are rounded down to the nearest ten cent value or, essentially, 0. Everything else is rounded up to the next ten cent value.
It would be an interesting study to examine transactions to see if they conform to what the mathematical formula predicts, or if not, why not. If I were really so inclined, I could go through my bank statements and do a little analysis myself.
I also wonder if there's a way to game the system in the merchant's favor. Say, for example, that there are items that people generally come in to purchase without purchasing anything else, like packs of cigarettes. I bet if Wal-Mart had stores in NZ, they'd know how to do it.
The first time I encountered this system of rounding, it was something of a revelation. I'd never realized (or rather, been *taught*) that there were other ways of rounding. To round 5 down to 0 seemed to me as strange as saying that sometimes 1 + 1 = 3. I don't think that teaching kids who are just learning rounding that sometimes you do and sometimes you don't, but you would figure that buy the time I was learning cosines or logarithms or any thing else of that useless mathematical trivia, someone would have taught me that there are other rounding systems. In fact, before I encountered this, it never even occurred to me that in either system, rounding in one direction is favored, since the split is always going to be 4 to 5.
Boy, I could really use McD or MacD now!
But, when you go to the store, prices don't all end in 0. So if something is advertised as $19.99, it's really $20.00 ... but only if you are paying cash. If you pay by credit card or EFTPOS (the NZ equivalent of the debit card), then you pay $19.99.
To determine the cash price, NZ has generally adopted what is referred to as Swedish Rounding. (Sorry, but unlike other things described by the word 'Swedish', this isn't particularly exciting.) 'I don't think this is official government policy, but rather just the accepted practice. Under Swedish Rounding, cash transactions for totals ending in 1, 2, 3, 4, or 5 are rounded down to the nearest ten cent value or, essentially, 0. Everything else is rounded up to the next ten cent value.
It would be an interesting study to examine transactions to see if they conform to what the mathematical formula predicts, or if not, why not. If I were really so inclined, I could go through my bank statements and do a little analysis myself.
I also wonder if there's a way to game the system in the merchant's favor. Say, for example, that there are items that people generally come in to purchase without purchasing anything else, like packs of cigarettes. I bet if Wal-Mart had stores in NZ, they'd know how to do it.
The first time I encountered this system of rounding, it was something of a revelation. I'd never realized (or rather, been *taught*) that there were other ways of rounding. To round 5 down to 0 seemed to me as strange as saying that sometimes 1 + 1 = 3. I don't think that teaching kids who are just learning rounding that sometimes you do and sometimes you don't, but you would figure that buy the time I was learning cosines or logarithms or any thing else of that useless mathematical trivia, someone would have taught me that there are other rounding systems. In fact, before I encountered this, it never even occurred to me that in either system, rounding in one direction is favored, since the split is always going to be 4 to 5.
Boy, I could really use McD or MacD now!
posted by Jon A at
9:02 AM
1 Comments:
Hello:) Yes, NZ and OZ do round up prices to the nearest 5cent BUT not the EU. the NL and Finland do not mint 1 and 2 cent coins but it's illegal to round up prices since any 1 or 2 cent coin from the EU is legal tender...Prices are often rounded up to the nearest 5 cent when you buy in convenient stores or gas station etc..but in supermarkest prices are often uneven or end in 29, 39 , 49 and so on...so rounding is unlikely since Europeans do have 1 and 2 cent coins. Whether you pay cash or credit, you pay the amount displayed..€ 19.99 will remain 19.99cash or credit. PP from Europe.
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