Skip to main content

American teenagers outranked by Chinese in money smarts

By CNN Staff
July 9, 2014 -- Updated 1758 GMT (0158 HKT)
Nearly 30,000 students across 18 of the world's industrialized nations were tested on how they understood financial matters.
Nearly 30,000 students across 18 of the world's industrialized nations were tested on how they understood financial matters.
STORY HIGHLIGHTS
  • The OECD tested "financial literacy" of 15-year-olds across 18 countries
  • American teenagers rank below average -- while Chinese kids are the best
  • Try the test yourself, answers are at the bottom of the story

(CNN) -- American teenagers rank below average when it comes to understanding the value of money -- while Chinese kids are the best.

In a quiz designed by the Organization for Economic Cooperation and Development to reveal "financial literacy" of 15-year-olds, students from the U.S., Russia and Latvia emerged as below middling. Teens from China, Belgium, Estonia, Australia and New Zealand were revealed as the savviest.

Nearly 30,000 students across 18 of the world's industrialized nations were tested on how they understood financial matters for the report.

Financial literacy ranking

1. Shanghai-China
2. Belgium
3. Estonia
4. Australia
5. New Zealand
6. Czech Republic
7. Poland
OECD Average
8. Latvia
9. United States
10. Russia
11. France
12. Slovenia
13. Spain
14. Croatia
15. Israel
16. Slovak Republic
17. Italy
18. Colombia
Source: OECD

The 15-year olds were given range of tasks -- from figuring out an invoice and payslip to making a judgment on value of money.

Do you think consider yourself money smart? Then try answering the three questions below, taken from the OECD test. Answers are at the bottom of the story.

1. You can buy tomatoes by the kilogram or by the box.

Bought loose, they are $2.75 per kilogram, while a 10 kilogram box is $22. The box of tomatoes is better value for money than the loose tomatoes.

Why?

2: Mrs Jones has a loan of $8,000 with FirstZed Finance.

The annual interest rate on the loan is 15%. Her repayments each month are $150. After one year Mrs Jones still owes $7,400.

Another finance company called Zedbest will give Mrs Jones a loan of $10,000 with an annual interest rate of 13%. Her repayments each month would also be $150. If she takes the Zedbest loan, Mrs Jones will immediately pay off her existing loan.

What are two other financial benefits for Mrs Jones if she takes the Zedbest loan? What is one possible negative financial consequence for Mrs Jones if she agrees to the Zedbest loan?

3: Each month, Jane's salary is paid into her bank account. This is Jane's pay slip for July:

EMPLOYEE PAY SLIP: Jane Citizen - 1 July to 31 July

Position: Manager

Gross salary $2,800

Deductions $300

Net salary $2,500

Gross salary to date this year $19,600

How much money did Jane's employer pay into her bank account on 31 July?

A. $300

B. $2,500

C. $2,800

D. $19,600

Answers:

1. The price per kilogram of boxed tomatoes is less than the price per kilogram for loose tomatoes -- $2.20 per kg for the boxed tomatoes compared to $2.75 per kg for the loose tomatoes.

2. Mrs Jones will have extra money to use and will get a lower interest rate. But she will also owe more money overall, will pay more interest in total and will take longer to repay her debt.

3: B

(Source: OECD)

ADVERTISEMENT
Part of complete coverage on
August 18, 2014 -- Updated 1236 GMT (2036 HKT)
Europe's deteriorating relationship with Russia has hit the region's growth, even before new food sanctions begin to bite.
July 16, 2014 -- Updated 1634 GMT (0034 HKT)
With cyberattacks on the rise and here to stay, it's a modern-day challenge for people and businesses to get smarter about preventing them.
August 14, 2014 -- Updated 1324 GMT (2124 HKT)
Airstrikes, rebels seizing control of oil fields, plus a severe refugee crisis are a recipe for market panic. So why are Iraq oil prices stable?
July 20, 2014 -- Updated 1524 GMT (2324 HKT)
Evidence points to pro-Russian separatists as perpetrators of the attack and Vladimir Putin is facing uncomfortable questions, David Clark writes.
August 5, 2014 -- Updated 1440 GMT (2240 HKT)
The biggest Ebola outbreak in history is taking its toll in Western Africa, hitting some of West Africa's most vulnerable economies.
July 3, 2014 -- Updated 0902 GMT (1702 HKT)
Macau has overtaken Switzerland in the wealth stakes, being named the world's fourth richest territory by the World Bank.
July 18, 2014 -- Updated 1447 GMT (2247 HKT)
Saudi Arabian Bateel brand is best known for its delectable dates but it now has more than a dozen cafes and a new bakery in the works.
July 17, 2014 -- Updated 1100 GMT (1900 HKT)
A British nanotech company has created what it says is the world's darkest material. It is so dark the human eye can't discern its shape and form.
July 16, 2014 -- Updated 1602 GMT (0002 HKT)
Jibo robot is designed to be an organizer, educator and assist family members. CNN's Maggie Lake met him and says she was impressed with his skills.
July 18, 2014 -- Updated 2109 GMT (0509 HKT)
American burger joints have sprung up all over London, but how to know which ones are best? CNN's Jim Boulden investigates.
June 18, 2014 -- Updated 1222 GMT (2022 HKT)
Sandwiched in between Iraq and Syria, Jordan's destiny seems to be one of a constant struggle for survival. John Defterios explains.
June 18, 2014 -- Updated 1502 GMT (2302 HKT)
At the last football World Cup, it was all about 3D. This time around, it's nothing less than 4K.
July 16, 2014 -- Updated 1058 GMT (1858 HKT)
Bob Mazzer has photographed inside London's Tube network for 40 years. He's captured history.
July 18, 2014 -- Updated 1712 GMT (0112 HKT)
Exotic animals are becoming a profitable business opportunity for Nicaraguan entrepreneurs. CNN's Rafael Romo reports.
June 13, 2014 -- Updated 1529 GMT (2329 HKT)
Iraq produces 3.3 million barrels per day and has the world's fourth-largest oil reserves. But the current crisis is putting all this in danger.
June 18, 2014 -- Updated 1222 GMT (2022 HKT)
Sandwiched in between Iraq and Syria, Jordan's destiny seems to be one of a constant struggle for survival. John Defterios explains.
June 16, 2014 -- Updated 1314 GMT (2114 HKT)
The gas standoff between Russia and Ukraine could have a knock-on effect on Europe. Explore this map to find out why is the EU nervous.
July 16, 2014 -- Updated 1058 GMT (1858 HKT)
Bob Mazzer has photographed inside London's Tube network for 40 years. He's captured history.
June 17, 2014 -- Updated 1206 GMT (2006 HKT)
The UK capital promotes its tech stars and shows it can compete with Silicon Valley. Here are five companies that pitch to make it big.
ADVERTISEMENT