Rounding Rules on the GMAT: Slip to the Side and Look for a Five!

Quarter Wit, Quarter WisdomThe famous rounding song by Joe Crone is pretty much all you need to solve the trickiest of rounding questions on GMAT:

You just slip to the side, and you look for a five.

Well if the number that you see is a five or more, 

You gotta round up now, that’s for sure.

If the number that you see is a four or less, 

   You gotta round down to avoid a mess.

To put it in our own words, when we round a decimal, we drop the extra decimal places and apply certain rules:

-          If the first dropped digit is 5 or greater, we round up the last digit that we keep.

-          If the first dropped digit is 4 or smaller, we keep the last digit that we keep, the same.

For Example, we need to round the following decimals to two digits after decimal:

(a) 3.857

We drop 7. Since 7 is ‘5 or greater’, we are left with 3.86

(b) 12.983

We drop 3. Since 3 is ‘4 or smaller’, we are left with 12.98

(c) 26.75463

We drop 463. Since 4 is ‘4 or smaller’, we are left with 26.75

(d) 8.9675

We drop 75. Since 7 is ‘5 or greater’, we are left with 8.97

Note example (c) carefully:

When we round 26.75463 to two decimal places, we do not start rounding from the rightmost digit i.e. this is incorrect: 26.75463 becomes 26.7546 which becomes 26.755 which further becomes 26.76 – this is not correct. .00463 is less than .005 and hence should be ignored. You only need to worry about the digit right next to the digit you are keeping. Just slip to the side, and look for a five!

A logical question arises: what happens when we have, say, 2.5 and we need to round it to the nearest integer? 2.5 is midway between 2 and 3. In that case, why do we round the number up, as the rule suggests? Note that a 2.5 is a tie and we have many tie breaking rules that can be used. They are ‘Round half to odd’, ‘Round half to even’, ‘Round up’, ‘Round down’, ‘Round towards 0’, ‘Round away from 0’ etc. We don’t need to worry about all these since GMAT uses only Round up i.e. 2.5 will be rounded up to 3.

Let’s take a look at a question now which uses these fundamentals.

Question: The exact cost price to make each unit of a widget is $7.6xy7, where x and y represent single digits. What is the value of y?

Statement 1: When the cost is rounded to the nearest cent, it becomes $7.65.

Statement 2: When the cost is rounded to the nearest tenth of a cent, it becomes $7.65.

Solution: The question is based on rounding. We need to figure out the value of y given some rounding scenarios. Let’s look at them one by one.

Statement 1: When the cost is rounded to the nearest cent, it becomes $7.65.

When rounded to the nearest cent, the cost becomes 7 dollars and 65 cents. 6xy7 cents got rounded to 65 cents. When will .6xy7 get rounded to .65? When .6xy7 lies anywhere in the range .6457 to .6547. Note that in all these cases, when you round the number to 2 digits, it will become .65.

Say price is 7.6468. We need to drop 68 but since 6 is ‘5 or greater’, 4 gets rounded up to 5.

Similarly, say the price is 7.6543. We need to drop 43. Since 4 is ‘4 or smaller’, 5 stays as it is.

So x and y can take various different values. This statement alone is not sufficient.

Statement 2: When the cost is rounded to the nearest tenth of a cent, it becomes $7.65

Now the cost is rounded to the tenth of a cent which means 3 places after the decimal. But the cost is given to us as $7.65. Since we need 3 places, the cost must be $7.650 (which will be written as $7.65)

When will 7.6xy7 get rounded to 7.650? Now this is the tricky part of the question – from 7.6xy7, you need to drop the 7 and round up y. When you do that, you get 7.650. This means 7.6xy7 must have been 7.6497. Only in this case, when we drop the 7, we round up the 9 to make 10, carry the 1 over to 4 and make it 5. This is the only way to get 7.650 on rounding 7.6xy7 to the tenth of a cent. Hence x must be 4 and y must be 9. This statement alone is sufficient to answer the question.

Answer (B)

Hope you see that a few simple rules can make rounding questions quite easy.

Karishma, a Computer Engineer with a keen interest in alternative Mathematical approaches, has mentored students in the continents of Asia, Europe and North America. She teaches the GMAT for Veritas Prep and regularly participates in content development projects such as this blog!

2 Responses

  1. Ram says:

    Hi Karishma,

    Very helpful post!

    I had a hard time figuring out ‘the cost is rounded to the tenth of a cent which means 3 places after the decimal’ part when solving the question.

    Is there a set of rules that I use to determine how many places one needs to round to?

    Thanks,
    Ram

    • Karishma says:

      When the cost is in dollars such as 34.10, it represents 34 dollars and 10 cents, right? 12.35 would be 12 dollars and 35 cents.

      Say if the cost is 34.1083 and we need to round to a cent, it means we need to find the nearest cent it represents so we round to two places after the decimal and it becomes 34.11.
      If we round to the tenth of a cent, it means we want to find the nearest (1/10th) of a cent which is given by the third decimal place. so we will round it to 34.108

      Usually, the questions directly give you the number of places to which you need to round – rounded to two places after the decimal/three places after the decimal etc.

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