Round to the nearest penny.

Your friend gives you a gift card for $25.
CD's cost $10.98 each plus 5.25% sales tax.
You buy as many CD's as possible without
having to pay any extra money. What is the
balance on the card after the purchase?

1 answer

To calculate how many CDs you can buy with a $25 gift card given that each CD costs $10.98 plus 5.25% sales tax, we first need to determine the total cost of each CD including tax.

  1. Calculate the sales tax for one CD: \[ \text{Sales Tax} = 10.98 \times 0.0525 = 0.57765 \]

  2. Add the sales tax to the original price of the CD to find the total cost: \[ \text{Total Cost per CD} = 10.98 + 0.57765 = 11.55765 \] Rounding this to the nearest penny: \[ \text{Total Cost per CD} = 11.56 \]

  3. Now we determine how many CDs you can buy with the $25 gift card: \[ \text{Number of CDs} = \text{Floor}\left(\frac{25}{11.56}\right) = \text{Floor}(2.162) \] So, you can buy 2 CDs.

  4. Calculate the total cost for 2 CDs: \[ \text{Total Cost for 2 CDs} = 2 \times 11.56 = 23.12 \]

  5. Determine the balance remaining on the gift card after the purchase: \[ \text{Balance} = 25 - 23.12 = 1.88 \]

Therefore, the balance on the card after the purchase is $1.88.