The price of a massage chair with 6% GST is $742.
- How much does Adam have to pay if the GST is decreased to 1%?
- How much saving does Adam enjoy as a result of the decrease in GST?
(a)
Price of the massage chair with 6% GST
= 100% + 6%
= 106%
106% → $742
1% → 742 ÷ 106 = $7
100% → 100 x 7 = $700
Price of the massage chair with 1% GST
= 100% + 1%
= 101%
Amount that Adam has to pay
= 101% x 700
=
101100 x 700
= $707
(b)
Saving that Adam enjoys
= 742 - 707
= $35
Answer(s): (a) $707; (b) $35