The price of a mobile phone with 12% GST is $784.
- How much does Adam have to pay if the GST is decreased to 4%?
- How much saving does Adam enjoy as a result of the decrease in GST?
(a)
Price of the mobile phone with 12% GST
= 100% + 12%
= 112%
112% → $784
1% → 784 ÷ 112 = $7
100% → 100 x 7 = $700
Price of the mobile phone with 4% GST
= 100% + 4%
= 104%
Amount that Adam has to pay
= 104% x 700
=
104100 x 700
= $728
(b)
Saving that Adam enjoys
= 784 - 728
= $56
Answer(s): (a) $728; (b) $56