Understanding Discounts

A discount is a reduction from the original price of a product or service. Discounts are usually expressed as a percentage, like "20% off" or "Save 30%". Understanding how to calculate discounts helps you make smarter shopping decisions and know exactly how much you are saving.

The Basic Discount Formula

Step-by-Step Example

Let's say you want to buy a $80 jacket that is 25% off:

1. Calculate the discount amount: $80 × (25 ÷ 100) = $80 × 0.25 = $20
2. Subtract from original price: $80 - $20 = $60
3. Final price: $60

Quick Calculation Method

You can also calculate the final price directly using this formula:

Using the same example: $80 × (1 - 0.25) = $80 × 0.75 = $60

Multiple Discounts

When multiple discounts apply (like a store sale plus a coupon), they are usually applied sequentially, not added together.

Example: 20% off + Extra 10% off

For a $100 item:

1. First discount (20%): $100 × 0.80 = $80
2. Second discount (10% off $80): $80 × 0.90 = $72
3. Final price: $72 (not $70 as if you added 20% + 10%)

Common Discount Percentages

Pro Tips

• Compare unit prices when buying in bulk to ensure the discount is actually saving you money
• Calculate before buying: Know the final price before reaching the checkout
• Beware of "up to" discounts: "Up to 50% off" means the maximum discount, not what every item has
• Check the original price: Some retailers inflate prices before applying discounts