The price of a stereo system with 4% GST is $1872.
- How much does Adam have to pay if the GST is decreased to 2%?
- How much saving does Adam enjoy as a result of the decrease in GST?
(a)
Price of the stereo system with 4% GST
= 100% + 4%
= 104%
104% → $1872
1% → 1872 ÷ 104 = $18
100% → 100 x 18 = $1800
Price of the stereo system with 2% GST
= 100% + 2%
= 102%
Amount that Adam has to pay
= 102% x 1800
=
102100 x 1800
= $1836
(b)
Saving that Adam enjoys
= 1872 - 1836
= $36
Answer(s): (a) $1836; (b) $36