Question

I purchased a hair-dryer for ₹5,400 including 8% VAT. Find the price before VAT was added.

Answer 1

Step 1 : Interpreting the problem.

The price includes VAT.
So, 8% VAT means that if the price without VAT is ₹ 100,
then price including VAT will be ₹ 108.

Step 2: Calculating the price before VAT.
When price including VAT is ₹108, original price = ₹100
When price including VAT is ₹5400, original price
$=₹\frac{100}{108}\times 5400$
$=₹5000$
Therefore, the price of the hair-dryer before the addition of VAT was ₹5,000.