# How to calculate sales tax

To calculate sales tax of an item, simply multiply the cost of the item by the tax rate.

Exercises # 1:

You buy a car for 20,000 dollars and pay 5% in tax. How much is tax?

Tax = 20,000 times 5% = 20,000 times 0.05

Tax = 20,000 times 0.05 = 1,000 dollars.

The cost with tax is 20,000 + 1000 = 21,000

Exercises # 2:

You buy a house for 400,000 dollars and pay a tax of 6%. How much is tax?

Tax = 400,000 times 6%

Tax = 400,000 times 0.06 = 24,000 dollars

The cost with tax is 400,000 + 24,000 = 424,000 dollars.

Exercises # 3:

The list price of a scientific calculator is 100 dollars.If you get a price discount of 15% and pay 5% for tax, what is the actual cost of your calculator?

First, find the price after the discount

Discount = 100 times 15% = 100 times 0.15 = 15

Sale price = 100 - 15 = 85 dollars

Tax paid = 85 times 5% = 85 times 0.05 = 4.25

Actual cost = 85 + 4.25 = 89.25 dollars.

You will get the same answer if you compute the tax paid first and then compute the discount.

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