The price of a stereo system with 10% GST is $1650.
- 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 stereo system with 10% GST
= 100% + 10%
= 110%
110% → $1650
1% → 1650 ÷ 110 = $15
100% → 100 x 15 = $1500
Price of the stereo system with 1% GST
= 100% + 1%
= 101%
Amount that Adam has to pay
= 101% x 1500
=
101100 x 1500
= $1515
(b)
Saving that Adam enjoys
= 1650 - 1515
= $135
Answer(s): (a) $1515; (b) $135