Problem: Applied to a bill for $10,000 the difference between a discount of 40% and two successive discounts of 36% and 4%, expressed in dollars, is:
Answer Choices:
A. 0
B. 144
C. 256
D. 400
E. 416
Solution:
40% of $10,000 is $4,000
36% of $10,000 is $3,600;4% of ($10,000−$3,600) is $256.
$3,600+$256=$3,856∴ Difference is 4000−3856=144
or
Two successive discounts of 36% and 4% are equivalent to one discount of 38.56%(.36+.04−(.36)(.04)=.3856)