The price of a stereo system with 11% GST is $888.
- How much does Adam have to pay if the GST is decreased to 6%?
- How much saving does Adam enjoy as a result of the decrease in GST?
(a)
Price of the stereo system with 11% GST
= 100% + 11%
= 111%
111% → $888
1% → 888 ÷ 111 = $8
100% → 100 x 8 = $800
Price of the stereo system with 6% GST
= 100% + 6%
= 106%
Amount that Adam has to pay
= 106% x 800
=
106100 x 800
= $848
(b)
Saving that Adam enjoys
= 888 - 848
= $40
Answer(s): (a) $848; (b) $40