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

(iv) decreases by 3%.

Answer 1

Step 1: Given information:

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

Rate of GST$=10\%$

Step 2: Calculate list price:

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

Calculate GST on list price.

$$\begin{gathered} \mathrm{GST}=y\times \frac{10}{100} \\ =\frac{y}{10} \end{gathered}$$

Calculate the list price.

$\begin{array}{rcl}\mathrm{Price}& =& \mathrm{y}+\frac{\mathrm{y}}{10}\\ & \Rightarrow & y+\frac{y}{10}=8,250\\ & \Rightarrow & \frac{11}{10}y=8,250\\ & \Rightarrow & y=8,250\times \frac{10}{11}\\ \therefore y& =& \mathrm{Rs}.7,500\end{array}$

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

Step 3: Calculate the deduced amount paid by the customer:

Calculate Rate of GST.

$\begin{array}{rcl}\mathrm{Rate}\mathrm{of}\mathrm{GST}& =& (10-3)\%\\ & =& 7\%\end{array}$

Calculate the sale price.

$\begin{array}{rcl}\mathrm{sale}\mathrm{price}& =& \frac{7,500\times (100+7)}{100}\\ & =& \mathrm{Rs}.8,025\end{array}$

Calculate the amount deduced after decreasing GST.

$\begin{array}{rcl}\mathrm{Amount}& =& 8,250-8,025\\ \therefore \mathrm{Amount}& =& \mathrm{Rs}.225\end{array}$

Hence, the customer will pay $\mathrm{Rs}.225$ less if the GST is decreased by $3\%$.