ATI TEAS (Test of Essential Academic Skills) Version 7MathematicsHard
A hospital cafeteria offers a 20% discount to all employees. If an employee's meal costs $12.50 before the discount and a 7% sales tax is applied to the discounted price, what is the final cost of the meal?
- A$11.25
- B$10.70
- C$9.75
- D$10.00
Show answer & explanationAnswer & explanation
Correct answer: B. $10.70
First, calculate the discounted price: $12.50 * (1 - 0.20) = $12.50 * 0.80 = $10.00. Then, calculate the sales tax on the discounted price: $10.00 * 0.07 = $0.70. Finally, add the sales tax to the discounted price: $10.00 + $0.70 = $10.70.
Why the other options are wrong
- A. This indicates an error in calculating either the discount or the sales tax, or applying them incorrectly.
- C. This might result from applying the tax to the original price then the discount, or a calculation error.
- D. This is the discounted price before sales tax is applied.
Sequential Percentage Calculation
Calculating a final value after applying multiple percentages (e.g., discount then tax) sequentially to an initial value.
- Apply the first percentage (e.g., discount) to the original price.
- Take the result of the first calculation and apply the second percentage (e.g., tax) to it.
- Order matters: discount is usually applied before tax.
Memory trick: Discount first, then tax; order matters, that's a fact!