Question

The Agents Benevolent Fund needs to raise R⁴⁴ 100 . They are considering taxing the souvenir items sold by their mail-order catalogue. It is estimated that the mail order sales will be R¹ 470000 for the year. What tax rate will yield R⁴⁴ 100?

Answer 1

To determine the tax rate that would yield R⁴⁴ 100 from R¹ 470000 in sales, divide R⁴⁴ 100 by R¹ 470000 and convert to a percentage, resulting in approximately 0.9415%.

Step-by-step explanation:

To calculate the tax rate needed for the Agents Benevolent Fund to raise R⁴⁴ 100, we need to relate this amount to the estimated mail-order sales, which are R¹ 470000 for the year. The tax rate is found by dividing the amount needed, R⁴⁴ 100, by the estimated sales, R¹ 470000, and then converting the result into a percentage.

First, we set up the equation:

R⁴⁴ 100 = R¹ 470000 × tax rate

Next, solve for the tax rate:

tax rate = R⁴⁴ 100 / R¹ 470000

After performing the division, we have:

tax rate = 0.00941489362

Finally, convert this decimal to a percentage:

tax rate = (0.00941489362) × 100% ≈ 0.9415%

So, a tax rate of approximately 0.9415% on the mail-order sales would raise the required amount of R⁴⁴ 100.