markup, discount, taxes, and interest
DESCRIPTION
Our Objective? We will take the skills we have used in finding percent values and apply this to real-world problemsTRANSCRIPT
Applying Percent
Markup, Discount, Taxes, and Interest
Our Objective?
• We will take the skills we have used in finding percent values and apply this to real-world problems
Vocabulary• Taxes A percent of an item’s cost added to find the final price Interest A percent of an amount of money (principal) added to, or paid for, its use Markup An amount, based on a percent, added TO a value to INCREASE its price Discount An amount, based on a percent, deducted FROM a value to DECREASE its
price
Wholesale Retail% of price increase = markup
Sales TaxIn Tennessee, we have a 9.25% sales tax.
What would the final price be for an iPod case that costs $27.50?
Price: $27.50Tax rate: x .0925Sales tax: $2.54
Final cost? $27.50 + 2.54 $30.04
If you are ONLY lookingfor the final price, thereis a one-step method:
$27.50 (1.0925) = This gives you
the tax amount.This adds the priceback into the problem.
What is the sales tax on a$1200 television?
$1200(.0925) = sales tax
$111.00 = sales tax
So the $1200 television will cost $1311 at the checkout.
Your savings account earns 3% each year.How much interest will you earn on aprincipal of $2500 for one year?
Simple interest formula: I = prt This means the interest you earn= principal($)rate(%)time(in years)
I = prt I = 2500(.03)1 I = $75
Year 1 $2500 Interest $ 75.00 Balance $2575.00
Year 2 $2575 Interest (.03)2575 Balance
Year 3 Interest Balance
$ 77.25 $2652.25
$ 2652.25 $ 79.57 $ 2731.82
Let’s see how much you would havein the bank if you let your interest becomepart of the principal for three years.
Your home has a 4.5% interest rate on a mortgage of$175,000 for a 30-year period.
How much total interest could you expect to pay onthis home over the life of the loan?
I = prt
This is just the interest…….NOT the amountof the mortgage…….
Ready ????I = $236,250
I = $175,000(.045)(30)
This is an oversimplified application of mortgage interest…….
Your credit card has a balance of $2500.
The issuing company charges you 18% annualinterest. How much will you pay in interestover one year?
I = prt
I = 2500(.18)1I = $450.00
Not in your notes…
What would you have to pay asa one-time payment if you paid theentire balance off in 6 months?
I = prtI = 2500(.18)(.5)I = $225.00
$2500 + 225 = $2725.00
As a store-owner, you mark-up what you haveto pay for an item so you can make a profit.
You purchased some lap desks for computers at a cost of $12 each..
You will markup each lap desk by 70% to find your retail price. What is the retail price?
What is 70% of 12?n = .70 ( 12 )n = $8.40
Retail price??$12.00 + $8.40 =
$ 20.40
If you paid $125 for each DooBop,and you will sell each for $210,what is your percent of markup?(% of increase??)
Increase = change original
Increase = 85 $125
Increase = 68%
You have been looking at a computer that normally retailsfor $850.00
Today it is on sale for 20% off.Find both the discount and sale price..20(850) = discount$170 = discount
Price – discount = sale price$850 - $170 = $680
One-Step Method for Sale Price ONLY!!!!!!!!
If you are NOT going to pay 20% of the retailprice, you WILL pay 80% of the price.
$850(.8) = $680
Regular Price
$49.50
12% off
$49.50 (.12) = discount$5.94= discount
$49.50 - $5.94 = $43.56Sale Price????
One step??$49.50 (.88) = sale price
$43.56= sale price
You paid $12.00 for a shirtthat is normally priced at$22.50.
What was the % of discount? (% of decrease)
Change = % decreaseOriginal
$10.50 = % change$22.50
Discount ~ 47%
$2800 15% OFF
.15(2800) = discount$420 = discount
$2800 - $420 = sale price$2380 = sale price
$2800(.85)= sale price$2380 = sale price
$2380(.0925) = tax$220.15 = tax
$220.15 + $2380 = price$2600.15 = price
$2380(1.0925) = price+tax$2600.15 = price
AllSteps
Fewersteps
Previous Applications
• Interest• Taxes• Percent of Change• Discounts and Markups
Today? Commission and tips
Working with CommissionCommission is an amount paid based on a percent of sales.
In your new position as sales manager, you will receive a salary of $500per week and 15% of the sales that your department generates for your store.
How much would you expect to receive if your department sold $25,000 worthof merchandise during the week.
Pay = salary + .15 of sales
Pay = 500 + .15(25,000)
Pay = $500 + $3750
Pay = $4250
As a salesperson in an electronics store, you receive 12% of your sales forone month. You also get a monthly salary of $1000. How much would youhave to create in sales to make $4500 for the month?
4500 = 1000 + .12(sales)
You were disappointed in the sales of your department this month. The salestotaled $3500. This was just 65% of what you had expected. What salesamount had you expected this month? Round to the nearest dollar.
Write an equation………. “This” was(is) 65% of expected3500 = .65(expected sales)
3500 = .65n
Now what? _____ _____ .65 .65
$5385.00 = n
Real estate agents get a commission on homes they sell. The expectedcommission rate is 6%. If an agent sold a home for $200,000, what would their commission be?
TipsTips are normally paid to those in the service industry as recognition forappreciation of a job well done!!!
Tips are normally based on the total of a bill.
The Billings family ate at their favorite restaurant.The final bill came to $56.75. The service was reallygood, so Mr. Billings decided to leave an 18% tip.
What is 18% of 56.75?.18(56.75) = tip amount
$10.22 = tip amount What will they pay forthe dinner with the tip and taxincluded?
Dinner $56.75Tax 5.25Tip + 10.22 $72.22
Don’t forget thetax!!! 9.25%
.0925(56.75) = tax.0925(56.75) = $5.25
You and four friends go out to dinner. You have decided toshare the cost of the meal and the tip equally.The food and service were both good! Everyone agrees toleave a 20% tip!!!!! What will each of you have to pay forthe meal and tip?
Bill Total: $75.00
20% of $75 = tip.2(75) = $15.00$75 + $15.00 = total for all
$90 ÷ 5 = $18.00 each
Clean Clothes for You!!!This washing machine regularly sells for $475.00. This Saturday it will be on sale for 20% off. What will the sale price be? What will the final cost be after you add a 9.25% sales tax?
$475. - discount = sale price
.20(475) = discount$95 = discount
$475.00- 95.00 $ 380.00 Sale Price
$380 (.0925) = sales tax$35.15 = sales tax$ 380.00+ 35.15$ 415.15 = final price
$475(.8)= price $380 = price
Don’t forget me!!!
$380(.12)= commission $45.60 = commission
Did we apply percent conceptsto solve real-world problems?