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100 points for $49 worth of Veritas practice GMATs FREE VERITAS PRACTICE GMAT EXAMS Earn 10 Points Per Post Earn 10 Points Per Thanks Earn 10 Points Per Upvote ## Mr. Goldstein decides to buy a new car... tagged by: BTGmoderatorLU ##### This topic has 2 expert replies and 0 member replies ### Top Member ## Mr. Goldstein decides to buy a new car... Mr. Goldstein decides to buy a new car with a sticker price of$45,500. If the sales tax comes out to 5 percent of the purchase price, but Mr. Goldstein is able to negotiate a purchase price that is a 20 percent discount off the sticker price, how much sales tax does Mr. Goldstein pay?

a) $455 b)$910
c) $1560 d)$1820
e) $2275 The OA is D. Please, can any expert assist me with above problem? I don't have it clear. Thanks. ### GMAT/MBA Expert Legendary Member Joined 14 Jan 2015 Posted: 2667 messages Followed by: 122 members Upvotes: 1153 GMAT Score: 770 LUANDATO wrote: Mr. Goldstein decides to buy a new car with a sticker price of$45,500. If the sales tax comes out to 5 percent of the purchase price, but Mr. Goldstein is able to negotiate a purchase price that is a 20 percent discount off the sticker price, how much sales tax does Mr. Goldstein pay?

a) $455 b)$910
c) $1560 d)$1820
e) $2275 The OA is D. Please, can any expert assist me with above problem? I don't have it clear. Thanks. 10% of 45,500 = 4550. 20% of 45,500 = 4550*2 = 9100 So if we're getting a 20% discount, the new cost would be 45,500 - 9100 = 36,400. This is taxed at 5%. 5% of 36,400 = 1820. (10% of 36,400 = 3640, so 5% is half of this value.) The answer is D _________________ Veritas Prep | GMAT Instructor Veritas Prep Reviews Save$100 off any live Veritas Prep GMAT Course

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LUANDATO wrote:
Mr. Goldstein decides to buy a new car with a sticker price of $45,500. If the sales tax comes out to 5 percent of the purchase price, but Mr. Goldstein is able to negotiate a purchase price that is a 20 percent discount off the sticker price, how much sales tax does Mr. Goldstein pay? a)$455
b) $910 c)$1560
d) $1820 e)$2275
Alternate approach:
If a car with a sticker price of $100 is discounted by 20% to$80, the resulting sales tax = (5/100)(80) = $4. Since (resulting sales tax)/(sticker price) = 4/100 = 4%, the resulting sales tax = 4% of the sticker price. Thus: Mr. Goldstein's tax = (4/100)(45,500) = (4)(455) = 1820. The correct answer is D. _________________ Mitch Hunt Private Tutor for the GMAT and GRE GMATGuruNY@gmail.com If you find one of my posts helpful, please take a moment to click on the "UPVOTE" icon. Available for tutoring in NYC and long-distance. For more information, please email me at GMATGuruNY@gmail.com. Student Review #1 Student Review #2 Student Review #3 Free GMAT Practice Test How can you improve your test score if you don't know your baseline score? Take a free online practice exam. Get started on achieving your dream score today! Sign up now. • Award-winning private GMAT tutoring Register now and save up to$200

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