## Discount Formula

Shopkeepers offer discounts to customers to increase sales. A discount is a monetary compensation given to customers on a product’s listed price. Let’s look at the connections between these terms.

A deduction in the rate of goods and services offered by shopkeepers at the marked rate is called a discount. The list price, also called the marked price, is the rate of an item as declared by the manufacturer or seller, excluding discounts.

## Formula

Discount = List Price − Selling Price

Selling Price = List Price − Discount

List Price = Selling Price + Discount

## Discount Rate

When the price of something is reduced and sold, a discount is given. The term “discount rate” or “discount percentage” is a price reduction expressed as a percentage.

(List Price-Selling Price)/List Price 100 = Discount (%)

Discount/List Price times 100 = discount

## Discounts of Various Types

Discounts are divided into three categories:

**Trade Discount:**The distributor offers the trade discount to the regular seller rather than the customer. A distributor is a company that holds large quantities of a product and sells it to a seller who runs the store or a unit that sells the product. Trade discount is provided in order to facilitate the sale of the product.

## Solved Examples

**Example 1: How much of a discount did Bob get on a chair if the selling price was $7 and the list price was $10?**

**Solution:** Given that the list price is $10 and the selling price is $7.

As an outcome, the discount is equal to the difference in the list and selling prices. $10 minus $7 equals $3. As a result, Bob received a $3 discount.

**Example.2: A Rs. 40 dress is marked with a 25% discount in a department store. What is the discount going to be? What will this dress’s sale price be?**

**Solution:** The phrase “save 25% (i.e. 0.25)” refers to the discount rate.

The dress’s original price is listed as Rs. 40. The amount of the discount will be 0.25 Rs. 40 = Rs. 10 The following is the sale price:

40 rupees – 10 rupees=30 rupees

The sale price will be Rs. 30.00, with a discount of Rs. 10.00.