What Do Different Discount Rates Mean?

Understanding Different Discount Rates

Discount rates play a crucial role in determining the final price of a product or service. In the given scenario, a 20% discount means that for every $100 spent, $20 will be deducted from the total amount. This indicates that the customer will pay $80 instead of the original $100.

Now, let's break down the meanings of different discount rates:

1. 10% Discount: A 10% discount implies that for every $100 spent, $10 will be discounted from the total amount. Therefore, the customer will pay $90 for a $100 product or service.

2. 25% Discount: When a 25% discount is applied, it means that for every $100 spent, $25 will be deducted from the total amount. The customer will only have to pay $75 for a $100 item, after the discount is applied.

3. 50% Discount: A 50% discount signifies that for every $100 spent, $50 will be discounted from the total amount. This implies that the customer will pay only $50 for a $100 product or service.

Therefore, different discount rates result in varying final prices for customers, allowing them to save money on their purchases based on the percentage of discount offered.