Chapter 11, Problem 7MPS

To determine

To find: The usual price excluding taxes.

Answer to Problem 7MPS

The usual price is $1500\$$ .

Explanation of Solution

Given information:

The doo on computer is $25\%$ .

Tax on computer is $4\%$ .

The amount paid by Robinson is $\$1170$ .

Calculation:

Assume that usual price is $P$ .

Calculate the sale price.

  $\begin{array}{l}SP=P-P\left(\frac{25}{100}\right)\\ SP=P-0.25P\\ SP=0.75P\end{array}$

Calculate tax on sale price.

  $\begin{array}{l}tax=\frac{4}{100}\left(SP\right)\\ =\frac{4}{100}\left(0.75P\right)\\ =0.03P\end{array}$

Since the amount paid is sale price along with sale tax, so it can be expressed as.

  $\begin{array}{l}\$1170=0.75P+0.03P\\ \$1170=0.78P\\ P=1500\$\end{array}$

Therefore, the usual price is $1500\$$ .