Word Problems: Percentage Discount and Sales Tax: Example 1

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Consider the final price of a TV set which lists for $500 and is on sale for 20% off.
A 7% sales tax has to be paid on the selling price.

First express these percentages as decimals.

The decimals are 0.20 and 0.07.

Are these the values we really need to use? (Yes/No)

No.

If the selling price is 20% off the $500 list price, what percentage should we use to calculate the selling price from the list price?

The selling price is 80% of the list price.

With a 7% sales tax, what percentage should we use to calculate the final amount the customer should pay?

Since the final amount is 7% more than the selling price, we need to calculate 107% of the selling price.

Now use this information to determine the selling price.

selling price = 0.80 * 500 = 400

Calculate the final amount to be paid.

final amount = 1.07 * 400 = $428.

Show how these two decimals can be used to determine the final amount in a single calculation.

final amount = 1.07 * 0.80 * $500 = $428

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