Question

In January 2011 the rate of a VAT increased from 17.5% to 20% Work out the difference in price of a car worth £15000 + VAT due to the increase of VAT

Answer 1

Answer:

  £375

Step-by-step explanation:

The tax changed from 17.5% of the car's price to 20% of the car's price, an increase of 2.5% of the car's price.

The increased tax amount is ...

  0.025 × £15000 = £375

The price of the car went up by £375 due to the increase in VAT.