Suppose, a litre of cola costs US\$3.15. If you buy one third of a litre of cola, how much would you pay?

The above may seem like a rather basic question. Something that you would perhaps expect the vast majority of adults to be able to answer? Particularly if they are allowed to use a calculator.

Unfortunately, the reality is that a large number of adults across the world struggle with even such basic financial tasks (the correct answer is US\$1.05, by the way).

Using Organisation for Economic Cooperation and Development (OECD) Programme for International Assessment of Adult Competencies (PIAAC) data, my co-authors and I have looked at how adults from 31 countries answer four relatively simple financial questions.

As well as the question above, participants were asked such as: "Suppose, upon your trip to the grocery store you purchase four types of tea packs: Chamomile Tea (US\$4.60), Green Tea (US\$4.15), Black Tea (US\$3.35) and Lemon Tea (US\$1.80). If you paid for all these items with a US\$20 bill, how much change would you get?"

The results (as seen in the table) allowed us to create an estimated range for the percentage of the adult population who would be able to answer the cola question correctly. These results are based upon a random sample of adults from each country.

We found that Lithuania, Austria and Slovakia were the most successful, but even in these countries, one in four adults failed to give the correct answer.

In many other countries, the situation is even worse. Four in every ten adults in places like England, Canada, Spain and the US can't make this straightforward calculation – even when they had a calculator to hand. Similarly, less than half of adults in places like Chile, Turkey and South Korea can get the right .

Basic calculations

Of course, not all groups within each country perform quite so poorly, and there are notable differences in financial literacy skills between different demographic groups.

Across the four financial questions adults were asked, in most countries, men tended to perform slightly better than women. The young (particularly 25- to 34-year-olds) were also found to perform better than the over-55s.

The starkest differences were seen by education group. Returning to the first question given above, in many countries adults with a "low" level of education (the equivalent of completing secondary school) had less than a 50% chance of getting the question correct. In places like Canada and United States, this fell to as low as 25%.

Our results clearly highlight how many adults are ill equipped to make key financial decisions. And how in fact, many struggle to cope with even very simple financial tasks.

In the long term, this highlights the critical need for financial literacy to be taught in schools, to ensure young people are equipped for the complex financial decisions they will face in the real world.

More immediately, though, given the low level of financial skills among many , it is vital that the information provided with financial products is as simple and straightforward to interpret as possible. And in the age of payday loans, and high interest credit cards, adequate advice and guidance must also be available where needed. Because otherwise, there is a real danger that a large proportion of the population is at risk of making serious financial mistakes.

Explore further

For Americans, understanding money eases old age anxiety

Provided by The Conversation

Feedback to editors

Mar 15, 2018
Suppose, a litre of cola costs US\$3.15. If you buy one third of a litre of cola, how much would you pay?
Hopefully the actual questions were better posed than this. Cola is not sold in 1/3 liter bottles or cans. One cannot pour out a third of a liter bottle and purchase only the amount that was poured out. Even when buying "in bulk" by self-pouring at a soda fountain, one could pour exactly a third of a liter into one of the supplied cups, but one will end up paying for how much the cup is rated to hold, not how much it is actually holding. So many people when reading the question will assume it is a trick question. Perhaps the store only has liter bottles (or bigger) so that to get a third of a liter, one will have to purchase an entire liter. And voila, the answer is \$3.15.

Mar 15, 2018
Cola is not sold in 1/3 liter bottles or cans...
you've never seen a 33 cl can?

Mar 15, 2018
you've never seen a 33 cl can?

33 cl is not 1/3 liters. 33% out of \$3.15 is \$1.0395 not \$1.05

A common size of a can is 12 oz or 355 ml

In different places you also have additional deposit fees added to the price depending on the type and size of the container, plus VAT or sales tax, and the price of soda in a different packaging varies according to the whim of the shopkeeper, so seeing \$3.15 for a 1L bottle does not help you at all to estimate how much you'd pay for 1/3 L of cola.

In reality, if you pay \$3.15 for the 1 L bottle, you'd pay about \$1.20 for a 12 oz can, assuming the unit price is the same and the bottle deposit is 10 cents. However, the profit margin is greater for the larger bottle and the shopkeeper wants you to buy more soda, so the small can costs \$1.50, unless you bought the 12-pack, in which case the cost per can is lower, but you're still buying 12 cans of soda instead of one.

Mar 15, 2018
For everyday shopping, accurate math just isn't needed unless you're genuinely down to your last \$20.

I can do it because I spent a couple summers behind a manual cash register that didn't count the cash back, and I also learned to count coins the way croupiers do by "gist", i.e. you identify them in groups, stack them, and then count the stacks.

But every time I shop I still count at a precision of one dollar, if I count at all. The usual shopping run is going to run up to the same amount almost every time, because the items are almost always the same. If I need to be cost-conscious, I just count the number of items in the basket and assume some average price like \$2 per item.

And if I need to compare prices, I look at the unit price, not the item price.

Mar 15, 2018
A common size of a can is 12 oz or 355 ml
sorry for your limited worldview, E.

Mar 15, 2018
A common size of a can is 12 oz or 355 ml
sorry for your limited worldview, E.

Just pointing out reality. Other common sizes are 200 ml, 250 ml, 275 ml, 330 ml, 341 ml, 350 ml, 375 ml, 440 ml, 500 ml, 568 ml (pint), even 1000 ml.

But no 1/3 L can or bottle.

Even travelling in Europe, when I buy a cherry coke, it comes in a 355 ml can. Guess why?

Mar 15, 2018
So many people when reading the question will assume it is a trick

How would that impact different countries differently? I don't see the connection you're trying to build, here.

Mar 15, 2018
Can't believe 1 in 4 people can't do simple addition/division
this is troubling and a little scary

Mar 15, 2018
So what? I don't drink cola at all but I can still do 1/3 of \$3.15 in my head.

Mar 16, 2018
I have wondered just how many of us are born able to 'see' numbers in our head. That is the root of math I believe. I can't. I think we are born with natural ability or talent that we may or may not be able to use in the real world. Mine was art.
I suspect that the 'concern' that society will take advantage by unfair use and manipulation of math is superficially genuine but the manipulation will increase to the point we 'own' nothing and the end result is basically slavery. And it will be our fault as we 'failed' to learn math. Blame the victim.

Mar 16, 2018
A lot just of folks just fake it until they can't and then drop out of school and forget even the little they learnt. No one wants to admit this because of all the money and pride involved. This is also part of what makes the wealth disparity we see possible. Humans in general have simply not naturally selected for classrooms/cubicles and extremely mind numbing tasks and tend to stress themselves out trying to keep up with the increasing complexity. Either we upgrade the genome, feed skills directly into the brain or let robots take over. The media tends to focus on the few that really do excel at certain tasks and mock those that don't. You could also state that the lack of good self reliance and survival skills would render a lot society ill prepared for catastrophes even the "mathematically inclined."

Mar 16, 2018
So many people when reading the question will assume it is a trick

How would that impact different countries differently? I don't see the connection you're trying to build, here.

Some people assume it's a test and respond as such. Others take it as a genuine question and respond as such.

People trained in test-taking, such as in the countries with high PISA scores, answer as if they were answering a school exam. Others think about what a third of a liter of cola would actually cost, and answer "wrong" out of practical experience.

One is being book-smart, the other street-smart. One does exact arithmetic that has nothing to do with reality, the other does heuristic arithmetic that corresponds to what they'd actually encounter.

Mar 21, 2018
'the correct answer is US\$1.05, by the way'

Actual it will probably be more like \$2.10 - You will be charged more per litre for a smaller quantity!

This is not really 'math's, more 'arithmetic', something many animals can do without thinking (in their own way), in fact most of us do it, for example which carriage on a train is fuller etc.

For many people it might not be vital for their day to day existence. Where it helps is when you want to raise yourself and others above subsistence levels. Arithmetic (about numbers) is the first step to maths (about theory).

Mar 21, 2018
I had no trouble doing those problems in my head. But, I was raised in a different time in the US when math, English, literature, science, history, and music were better taught with more emphasis on learning and being well-rounded educationally, rather than the modern focus on mixing learning and indoctrination. Even in my rural, Southern little town, children and adults were better educated under the process of education we had then.

I can remember as a young adult in the 70s, my Dad (who graduated 11th grade in the rural one room schoolhouse before the Depression), already in his late 60s, could add a column of numbers faster in his head than I could using a calculator.

If American adults are behind today, look to how education has been "improved" over the last 30 years.

Mar 21, 2018
I had no trouble doing those problems in my head. But, I was raised in a different time in the US when math, English, literature, science, history, and music were better taught with more emphasis on learning and being well-rounded educationally, rather than the modern focus on mixing learning and indoctrination. Even in my rural, Southern little town, children and adults were better educated under the process of education we had then.

I can remember as a young adult in the 70s, my Dad (who graduated 11th grade in the rural one room schoolhouse before the Depression), already in his late 60s, could add a column of numbers faster in his head than I could using a calculator.

If American adults are behind today, look to how education has been "improved" over the last 30 years.

If that was true, we'd expect to see older americans perform better, statistically, than younger ones. The study suggests otherwise.

Apr 02, 2018
It could also be the use of phones. Most phones have calculators nowadays, and people can just easily take their phone out as second nature to calculate even the most simple math problem, like 4+5. As simple as it is, they could be 'lazy' to do it in their head.