How do I round 8.54 to the nearest hundredth?

You would look at the number in the hundredth's place which is 4. Then look to the right of that number. Because there is none, then add a zero. The zero would keep the 4 as a 4, therefore 8.54 rounded to the nearest hundredth is 8.54

It is just like rounding numbers. 8.54 is closer to 9 than to 8 because there is lest distance it has to travel on the number line