Final answer:
The single equivalent discount rate of a chain discount of 5/8/20 is approximately 30.08%, which is calculated by applying each discount successively to the remaining price. None of the choices are correct.
Step-by-step explanation:
The chain discount of 5/8/20 doesn't simply add up to calculate the single equivalent discount rate. Instead, each discount is applied successively to the remaining price after the previous discount has been applied. First, we take 5% off, then 8% off the reduced price, and finally 20% off the last discounted price. To calculate these:
- First discount: 100% - 5% = 95% remaining (or 0.95 as a decimal)
- Second discount: 95% - (8% of 95%) = 95% * 92% = 87.4% remaining (or 0.874 as a decimal)
- Third discount: 87.4% - (20% of 87.4%) = 87.4% * 80% = 69.92% remaining (or 0.6992 as a decimal)
To find the entire discount, subtract the remaining percentage from 100%:
100% - 69.92% = 30.08% discount
This means the single equivalent discount rate is approximately 30.08%, which is not one of the options given. As such, none of the options (33.3%, 25%, 50%, 75%) are correct.