/*! This file is auto-generated */ .wp-block-button__link{color:#fff;background-color:#32373c;border-radius:9999px;box-shadow:none;text-decoration:none;padding:calc(.667em + 2px) calc(1.333em + 2px);font-size:1.125em}.wp-block-file__button{background:#32373c;color:#fff;text-decoration:none} Problem 62 Explain how to use the sales tax... [FREE SOLUTION] | 91Ó°ÊÓ

91Ó°ÊÓ

Explain how to use the sales tax rate to determine an item's total cost.

Short Answer

Expert verified
Use the sales tax rate to calculate the sales tax by multiplying it with the initial cost of the item. Add the computed sales tax to the original price to get the total cost of the item. For instance, for an item that costs $200 with a sales tax rate of 7%, the total cost would be $214.

Step by step solution

01

Understand the Meaning of Sales Tax

Realise that sales tax rate is a percentage that a government levies on the sales of goods and services. This percentage is applied to the item's initial cost, not including the tax, to determine the sales tax.
02

Calculate the Sales Tax

To calculate sales tax, multiply the item's cost by the sales tax rate. For example, if an item costs $200 and the sales tax rate is 7%, the sales tax would be \(200 \times 0.07 = 14\) dollars.
03

Add the Sales Tax to the Original Price

Now, add the sales tax calculated in step 2 to the initial cost of the item. In this instance, the total cost including sales tax would be \(200 + 14 = 214\) dollars, which is the total price that a customer would pay.

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Key Concepts

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

Sales Tax Rate
When you go shopping, the price tag you see doesn't always represent the final amount you'll pay at the register. That's because of something called the sales tax. The sales tax rate is essentially a percentage tacked on to the cost of an item by the government. Each region sets its own rate, which means the rate can vary greatly depending on where you are. Understanding the sales tax rate is crucial as it affects your budgeting for any purchases. It's not just about the value of the item but also about how much more you'll need to spend.
Total Cost Calculation
Figuring out the total cost of an item with sales tax isn't as simple as just reading the price tag. Here's a handy guide for peace of mind at checkout: first, check the sales tax rate for your area. Once you have that number, take the price of your item and multiply it by the sales tax rate (remember to convert the rate into decimal form). This gives you the sales tax amount. Lastly, add this tax to the original price to find out the total cost. It’s always wise to calculate this before you reach the register so you aren't surprised by the final amount due.
Percentage Calculation
Percentages are everywhere in daily life, and calculating them is a skill you don't want to be without. When it comes to sales tax, understanding percentage calculation helps you determine how much extra you're paying. To convert a percentage to a decimal, simply divide it by 100. This is crucial for computing sales tax since you'll multiply the item’s cost by this decimal. For instance, a 7% sales tax rate becomes 0.07 (7 divided by 100). If an item costs \(100, you'll do the math: \)100 times 0.07 equals $7 in sales tax. Keep this in mind next time you're figuring out sales tax or even when you're tipping at a restaurant. It's essential for making accurate payments and sticking to your budget.
Mathematics in Everyday Life
Math isn't just for the classroom; it's a valuable tool that guides us in almost every aspect of our lives. From budgeting our expenses to understanding interest rates on loans, or even calculating cooking measurements, mathematics is there. Sales tax calculation is just one example where math applies in our day-to-day life. It's a simple application of percentages but shows how basic math can affect our financial decisions. Learning to calculate things like sales tax equips us with the understanding and confidence to manage our money effectively. Remember, whether you're comparing discounts at the store or adjusting a recipe, a good grasp of mathematics helps you navigate the numbers with ease.

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