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Video: Solving Word Problems by Calculating Tax Givens, Tax Rates, and Prices

Kathryn Kingham

If the tax rate is 7%, what will the sales tax be for a truck that costs $16 000?

02:22

Video Transcript

If the tax rate is seven percent, what will the sales tax be for a truck that costs 16000 dollars?

Let’s solve this problem by setting up a proportion. We’re given these values: seven percent and 16000 dollars. But we know that our seven percent can be turned into a fraction out of 100, so seven percent can be represented by a fraction seven out of 100. In this setup, the seven represents the amount that is the sales tax; what do you think 100 represents? The price of the item in this setup, 100, represents the price of the item before you add the sales tax. And we know that our truck costs 16000 dollars before we add the sales tax. So we’ll substitute the price of the item with 16000 dollars.

How would we get from 100 to 1600 [16000]? What can we multiply by 100 to get 1600 [16000]? 160; 100 times 160 equals 16000. And when we multiply the denominator by something, we need to multiply the numerator by that same amount. So we should multiply seven times 160 to find our sales tax. Seven times 160 equals 1120.

Now we’re gonna look back at our question to see what value they were asking us for. They asked, what will the sales tax be for a truck? So we know that the sales tax is 1120 dollars. If the question had asked us what the total cost of the truck would be, we would have to add the sales tax to the original price of the truck. But in this case, we’re only asked to find the sales tax, which we’ve done here.