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At the Happyville Mall, you buy a pair of earrings that are marked \$6.95. After sales tax, the bill was \(\$ 7.61 .\) What is the tax rate in Happyville (to the nearest tenth of a percent)?

Short Answer

Expert verified
The tax rate in Happyville is 9.5%.

Step by step solution

01

Calculate the total amount of tax paid

Subtract the original price of the earrings from the final bill to find out how much tax was paid. Final bill - Original Price = Tax Paid
02

Determine the tax rate

Divide the tax paid by the original price of the earrings, then multiply by 100 to get the tax rate as a percentage. (Tax Paid / Original Price) * 100 = Tax Rate
03

Round the tax rate to the nearest tenth of a percent

Round the result of the tax rate calculation to the nearest tenth of a percent to find the final tax rate.

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Key Concepts

These are the key concepts you need to understand to accurately answer the question.

Mathematical Problem-Solving
When faced with a real-world problem such as calculating a sales tax rate, mathematical problem-solving skills are crucial. It begins with understanding the problem – in this case, determining the sales tax rate applied to a purchase. The process typically involves identifying the given information and what we need to find out. For our scenario, we know the original price of an item and the final price after tax, and we need to calculate the tax rate.

Essentially, problem-solving in mathematics comes down to breaking down a problem into smaller, manageable steps. The first step is subtracting the original price from the final bill to find out the amount of tax paid. This straightforward arithmetic gives us the base for further calculations. Next, we have to perform a percentage calculation to determine the tax rate based on the tax amount and original price. Finally, we should round the calculated tax rate to the nearest tenth to match the real-world convention of presenting tax rates. Each step logically follows from the last, resulting in a clear solution to the problem.
Percentage Calculation
Understanding percentage calculation is essential in various aspects of daily life, from computing discounts to determining interest rates. It allows us to express a number as a fraction of 100, which is particularly useful in tax calculations. In our exercise, to find the sales tax rate, we must calculate the percentage of the tax paid relative to the original price.

This is achieved by dividing the amount of tax by the original price, which gives us a decimal representing the part of the whole original price that was added as tax. Multiplying this decimal by 100 converts it into a percentage. For instance, if we find that the tax amount is 10% of the original price, it means that for every 100 units of currency spent, an additional 10 units is added as tax. These operations are fundamental in tax mathematics and are the backbone of determining any tax rate.
Tax Mathematics
The field of tax mathematics deals with calculating taxes owed or tax rates, integrating the concepts of percentages and basic arithmetic. It's a practical application of arithmetic seen in everyday transactions. In our exercise scenario, tax mathematics involves determining how much more money you are paying due to tax on top of the initial price of an item.

Using the steps outlined, we first figure out the amount paid in tax by subtracting the item's price before tax from the final price after tax. This difference is the tax paid. Then, to express the tax paid as a rate, we compare it to the original price, giving us the rate at which the original price was taxed. This rate is then converted into a percentage for ease of understanding and communication. Being proficient in tax mathematics is vital since it enables consumers to understand how much extra they're paying due to taxes, and for businesses to correctly apply and report taxes on sales transactions.

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Most popular questions from this chapter

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