5.3-Applications of Percent taxes/discounts/interest

Lesson 5.3 -Applications of Percent-taxes/discounts/interest

The Basic Calculation

First we need to make sure that we understand how to find the percent of a number. The percent of a number is a fraction or part of a number that we will either add to or subtract from the original depending on whether it is a tax (add), discount (subtract), interest (add), or a combination of these.

So, if we need to find 6% of $38 we simply multiply the percent (written as a decimal) by the original .

0.06.......6% written as a decimal

x 38 .......The original(total) number

2.28

So, 6% of $38 is $2.28.

How to find Tax and Final Cost

So, if we have a meal that costs $38 and we must pay 6% sales tax we will need to find 6% of $38.

Again, we simply multiply the percent (written as a decimal) by the original .

0.06.......6% written as a decimal

x 38 .......The original(total) number

2.28

So, 6% of $38 is $2.28.

The sales tax is $2.28

Since it is a tax we will add it onto the cost to find the total bill.

Original cost + Tax = Final bill

$38 + $2.28 = $40.28

How to find Discount and New Cost

So, if we have a meal that costs $38 and we have coupon for a 6% discount, we will still need to find 6% of $38.

Again, we simply multiply the percent (written as a decimal) by the original .

0.06.......6% written as a decimal

x 38 .......The original(total) number

2.28

So, 6% of $38 is $2.28.

The Discount is $2.28

Since it is a Discount we will subtract it from the original cost to find the new cost (discounted price) .

Original cost - Discount = New cost (Discounted Price).

$38 - $2.28 = $35.72

(Now....you may have to figure a tax based on this new cost in order to find the final or total bill.)

How to find Interest and New Amount

So, if we have an amount of money-- $38 and we must pay simple interest of 6% of our total, we will STILL need to find 6% of $38!

Again, we simply multiply the percent (written as a decimal) by the original .

0.06.......6% written as a decimal

x 38 .......The original(total) number

2.28

So, 6% of $38 is $2.28.

The Interest is $2.28

Since we found Interest, we will add it to the original amount to find the new amount owed.

Original amount + Interest = New Amount.

$38 + $2.28 = $40.28

Commission

Sometimes people get paid based on how much they sell something for. A company will share a percent of what they make from you selling something(car, house, seed corn, etc.) with the person that sold the item.

So, if we sell something for an amount of money-- $38 our company will pay us a COMMISSION of 6% of our total sale.

We will STILL need to find 6% of $38!

Again, we simply multiply the percent (written as a decimal) by the original .

0.06.......6% written as a decimal

x 38 .......The original(total) number

2.28

So, 6% of $38 is $2.28.

The Interest is $2.28

Since we found Interest, we will add it to the original amount to find the new amount owed.

Original amount + Interest = New Amount.

$38 + $2.28 = $40.28

How to find Interest for multiple years and New Amount

Simple interest can be calculated for any number of years. So we can find the total amount to be paid back for 5 years.

So, if we have an amount of money-- $38 and we must pay simple interest of 6% over 5 years, we will STILL need to find 6% of $38!

>But then once we find the simple interest amount for one year, we add that amount on for each year we are paying the interest.(Or just multiply the interest by how many years you must paying it.)

Again, we simply multiply the percent (written as a decimal) by the original .

0.06.......6% written as a decimal

x 38 .......The original(total) number

2.28

So, 6% of $38 is $2.28.

The Interest is $2.28 for 1 year.

Since we found Interest for one year and we want to find the simple interest paid for 5 years, we will multiply interest by number of years to the original amount to find the new amount owed.

Interest x 5 years = interest for 5 years

$2.28 x 5 = $11.40

Original amount + total Interest = New Amount for 5 years

$38 + $11.40 = $40.28

How to find Interest for multiple years and New Amount

So, we want to find 6% simple interest calculated on $38 for 5 years.

Again, we simply multiply the percent (written as a decimal) by the original amount (Principal amount) .

0.06.......6% written as a decimal

x 38 .......The original(total) number

2.28

So, 6% of $38 is $2.28.

The Interest is $2.28 for 1 year.

Since we found Interest for one year and we want to find the simple interest paid for 5 years, we will multiply interest by number of years to the original amount to find the total interest owed.

Interest x 5 years = interest for 5 years

$2.28 x 5 = $11.40

To find the new total owed we add the Principal amount and the total interest for 5 years.

Original amount + total Interest = New Amount for 5 years

$38 + $11.40 = $49.40

Total amount owed after 5 years of 6% simple interest on $38 is $ 49.40.