Question

an item that cost $50 is marked 20% off. Sales tax for the item is 8%. What is the final price including tax? Solve the problem with the discount applied before the sales tax. Solve the problem with the discount applied after the sales tax.

Answer 1

$43.20

Explanation:

The price with tax is 100% + 8% = 1.08 times the price before tax. The discount multplies that price by 100% -20% = 0.80. The discount multiplier is the same whether the discount is applied before or after the tax.

The combined effect of the two multipliers is ...

... 1.08 × 0.80 = 0.864

so the discounted price with tax added is 0.864 × $50 = $43.20

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Perhaps you're supposed to figure the tax (8% of $50 = $4), add the tax ($50 +4 = $54), then subtract the discount (20% of $54 = $10.80) to get

$54.00 -10.80 = $43.20