Two Discounts Do Not Make Thirty
A sneaker store hangs a bold sign: 20 percent off all shoes, and an extra 10 percent off with a coupon. Maya wants a pair that costs 80 dollars. She adds the two discounts and expects to save 30 percent, which would bring the price down to 56 dollars. At the register, the total is 57 dollars and 60 cents. Did the store make a mistake?
It did not. A percent is always a part of some starting amount, and these two discounts do not use the same starting amount. The first discount takes 20 percent of 80 dollars, which is 16 dollars, so the shoes drop to 64 dollars. The coupon then takes 10 percent of the new price of 64 dollars, which is 6 dollars and 40 cents. After that is subtracted, the final price is 57 dollars and 60 cents.
The second discount saved less than Maya expected because it was figured on a smaller number. Ten percent of 64 dollars is less than ten percent of 80 dollars. That is why two discounts in a row always save a little less than the two percents added together.
Smart shoppers watch for the words "extra percent off." They often mean the second discount comes after the first one. Before you buy, work out the final price yourself, and you will know what to expect when you reach the register.