Question

The price of an article is Rs. 8,250 which includes GST at 10%. Find how much more or less does a customer pay for the article, if the GST on the article is increased to 20%

Answer 1

Step 1: Given data:

Price of an article$=\mathrm{Rs}.8,250$

Rate of GST$=10\%$

New rate of GST$=20\%$

Step 2: Calculate list price:

Let the list price be $\mathrm{Rs}.y$.

Then,

$\begin{array}{rcl}y+\left(10\%\mathrm{of}y\right)& =& 8,250\\ y+\left(\frac{10}{100}\times y\right)& =& 8,250\\ & \Rightarrow & y+\frac{y}{10}=8,250\\ & \Rightarrow & \frac{11}{10}y=8,250\\ & \Rightarrow & y=8,250\times \frac{10}{11}\\ \therefore y& =& \mathrm{Rs}.7,500\end{array}$

So, the list price is $\mathrm{Rs}.7,500$.

Step 3: Calculate the amount paid by the customer:

Calculate the selling price.

$\begin{array}{rcl}\mathrm{Selling}\mathrm{price}& =& \mathrm{List}\mathrm{price}+\left(20\%\mathrm{of}\mathrm{List}\mathrm{price}\right)\\ \mathrm{Selling}\mathrm{price}& =& 75,00+\left(\frac{20}{100}\times 75,00\right)\\ \therefore \mathrm{Selling}\mathrm{price}& =& \mathrm{Rs}.9,000\end{array}$

Calculate the extra amount paid by the customer.

$\begin{array}{rcl}\mathrm{Extra}\mathrm{Amount}& =& 9,000-8,250\\ \therefore \mathrm{Extra}\mathrm{Amount}& =& \mathrm{Rs}.750\end{array}$

Hence, the customer will pay Rs. 750 more.