The initial price of an engine was $450. To increase sales, the price was decreased by 12%. When it was realized that this new price was not profitable, the price was increased by 10%. Determine the final price of the engine. Answer on the back of the textbook is $435.60.
450 * 0.12 = 54
450 - 54 = 396
396 * .1 = 39.6
396 + 39.6 = $435.60
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To find the final price of the engine, we need to follow these steps:
Step 1: Calculate the price after a 12% decrease.
To do this, we need to find 12% of the initial price of $450 and subtract it from the initial price:
12% of $450 = (12/100) * $450 = $54
Price after 12% decrease = $450 - $54 = $396
Step 2: Calculate the price after a 10% increase.
To do this, we need to find 10% of the price after the 12% decrease and add it to that price:
10% of $396 = (10/100) * $396 = $39.60
Price after 10% increase = $396 + $39.60 = $435.60
Therefore, the final price of the engine is $435.60.
It's important to note that you can solve this problem by multiplying the initial price by a factor of (1 - 12/100) * (1 + 10/100) = 0.88 * 1.10 = 0.968. Multiplying the initial price by this factor also gives us $435.60.