The tax rate as a percent, r, charged on an item can be determined using the formula – 1 = r, where c is the final cost of the i
tem and p is the price of the item before tax. Louise rewrites the equation to solve for the final cost of the item: c = p(1 + ). What is the final cost of a $40 item after an 8% tax is applied?
c = p(1+r), where c is the total cost, p is the price of the item before tax, and r is the tax rate written as a decimal. This formula comes from the fact that adding a percent tax to the cost of an item takes 100% of the price and adds r% to it; this is why we multiply the price by (1+r).
Since our tax rate is 8%, r = 8% = 8/100 = 0.08. The price of the item is $40. Using this information, we have:
