16Hit1600
Problem-Solving and Data AnalysisVery hardCompound percent / successive discounts

Problem-Solving and Data Analysis practice question

An item priced at $200 is first marked down by 20%, and then an additional 10% is taken off the reduced price. What is the final price, in dollars?

Answer: 144

Apply the discounts successively: after 20% off, price = 0.80 × 200 = 160; after 10% off that, price = 0.90 × 160 = 144. The trap is adding the percents to 30% and taking 0.70 × 200 = 140; successive discounts multiply, they do not add.

Common wrong answers

If you answered 56
That's the total amount discounted (200 − 144), not the final price. The question asks what the customer pays: 144.
If you answered 140
You added the discounts to 30% and took 0.70 × 200. Successive discounts multiply: 0.80 × 200 = 160, then 0.90 × 160 = 144.
If you answered 160
That's the price after only the 20% markdown. You still need to take 10% off it: 0.90 × 160 = 144.

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