Calculating discounts is essential for understanding savings and managing budgets. Here’s a comprehensive guide on how to calculate discounts:

How to Calculate Discounts

1. Determine the Discount Amount:
   • Formula: Discount Amount = Original Price × (Discount Percentage / 100)
   • Example: If the original price of a product is $80 and the discount is 20%:
     • Calculation: Discount Amount = $80 × (20 / 100) = $16
2. Calculate the Final Price After Discount:
   • Formula: Final Price = Original Price – Discount Amount
   • Example: Using the previous example, the final price after a $16 discount on an $80 item:
     • Calculation: Final Price = $80 – $16 = $64
3. Calculate the Percentage Saved:
   • Formula: Percentage Saved = (Discount Amount / Original Price) × 100
   • Example: For a $16 discount on an $80 item:
     • Calculation: Percentage Saved = ($16 / $80) × 100 = 20%
4. Calculate the Discount Percentage if Given the Discount Amount and Final Price:
   • Formula: Discount Percentage = ((Original Price – Final Price) / Original Price) × 100
   • Example: If an item originally costs $100 and is now $75:
     • Calculation: Discount Percentage = (($100 – $75) / $100) × 100 = 25%

Quick Reference Table

Here’s a table showing the discount amount, final price, and percentage saved for various original prices and discount percentages:

Why Calculate Discounts?

• Budgeting: Helps in managing expenses and understanding savings during sales or promotions.
• Shopping: Provides insight into how much you are saving on purchases.
• Pricing Strategy: Useful for businesses to set discount rates and calculate promotional offers.

Example Scenarios

1. Applying a Discount:

• Original Price: $120
• Discount Percentage: 15%
• Calculation:
  • Discount Amount = $120 × (15 / 100) = $18
  • Final Price = $120 – $18 = $102

2. Finding the Discount Percentage:

• Original Price: $90
• Final Price: $72
• Calculation:
  • Discount Amount = $90 – $72 = $18
  • Discount Percentage = ($18 / $90) × 100 = 20%