Quiz: Financial Math Essentials — 4 questions

1. A shop marks an item at $80 and offers a 25% discount. What is the final sale price?

A. $60

B. $75

C. $20

D. $100

Answer: (A)

Explanation

A 25% discount on $80 is $20, so the final price is $80 - $20 = $60. The other options are either the discount amount or incorrect totals.

2. What does a discount mean in pricing?

A. The tax added to a sale price

B. The amount paid before any adjustments

C. An increase added to the original price

D. A reduction taken off the marked or original price

Answer: (D)

Explanation

A discount is a reduction from the marked or original price when an item is on sale. The other choices describe mark-up, VAT, or the original price instead.

3. What is VAT charged?

A. A reduction taken off the marked price

B. The total cost before any tax is added

C. A tax added to goods on sales and shown separately

D. The profit made on a sale

Answer: (C)

Explanation

VAT charged is the tax added to goods on sales and is recorded separately from the product price. The other options describe a discount, profit, or a pre-tax price.

4. If a sales docket shows a VAT amount separately from the product price, what should you do to answer a VAT question?

A. Ignore the VAT amount and use only the product price

B. Use the VAT amount and the displayed price data to work out the tax applied

C. Add the VAT amount to the product price without checking the values

D. Treat the VAT amount as a discount and subtract it from the price

Answer: (B)

Explanation

VAT problems require you to use the VAT amount shown and the displayed price information to determine the tax applied. The other choices either misuse VAT as a discount or ignore the separate VAT value.