Chapter 5 – Consumer Arithmetic
SALARIES & WAGES
1. An accountant earns an annual salary of $56,700. Calculate his gross monthly salary.
2. The gross annual salary earned by a civil servant is $54,000. Find his net monthly salary if
deductions of $1400 are made per month.
3. In a factory, all employees work a basic week of 40 hours. Any overtime worked during
weekdays is paid for at time-and-a-quarter. Overtime worked on Saturday is paid for at time-
and-a-half, whilst on Sunday it is paid for at double-time. If the basic rate is $14.60 per hour and
a man worked 15 hours overtime during weekdays, 6 hours overtime on Saturday and 5 hours
overtime on Sunday, calculate:
a) Basic wage
b) Overtime wage
c) His gross wage for the week
4. Jacob is paid $8.50 per hour for a 35 hour work week, and is paid double-time for any overtime
worked. If he is paid $450.50 in a certain week, how many hours did he work.
5. Carol worked a basic week of 40 hours. If her gross wage was $491.15, and her overtime was
$156.75, calculate
a) Her basic rate of payment
b) If overtime was paid at time-and-a quarter, find how many hours Carol worked overtime.
COMMISSION
6. Jennifer is paid a basic wage of $225 per week. In addition, she is paid a commission of 3% on
the cosmetics she sells above $5500. What are her earning that week if her cosmetic sales
amounts to $12,500?
7. The gross wage for Danny during a particular week was $646. If his basic wage was $475 and he
is paid a commission of 2.5% of the total value of goods sold, calculate
a) Danny’s commission
b) The total value of the goods sold that week.
INCOME TAX
8. John’s gross income was $18,000. His wife was unemployed and they have two children ages 13
and 17 (both at school). He paid 6 cents out of every dollar of his gross income for national
insurance, and the payments are non-taxable. Other tax free allowances and tax rates are given
in the following table.
Tax Free Personal allowances Tax rates on taxable income
Employee $1200 10% on first $4000
Unemployed spouse $800 20% on next $4000
Child under 11 years $200 40% on the remainder
Child between 11 and 16 years $250
Child over 16 years $300
a) What was the amount he paid for national insurance?
b) What was the total tax free personal allowances for his family?
c) What was his total non-taxable allowance?
d) What was the amount he paid in taxes?
e) What was his net income? (Ex.5V no.8)
PERCENTAGES – PROFIT & LOSS & PERCHENTAGE CHANGE
9. Calculate the loss percentage on a stove that was bought for $840 and sold for $600.
10. Jack buy a fridge for $870 and sells it for $900. What was the profit percentage?
11. Gabriel buys a bag for $120. What would be the selling price if she makes:
a) a 15% profit
b) a 20% loss
12. A store has a computer on sale for $1800.
a) If the store increases the price by 25%, what would be the new price.
b) If the store decreases the price by 12%, what would be the new price.
13. Nicholas buys a bed for $1250 and the store owner made a profit of 20%.
a) What was the original price?
b) If the store had not made a profit but instead a loss of 5% for $1250, what would have been
the original price?
14. Ken’s salary after a 5% increase was $4250. Calculate
a) His salary if a 3% increase was given instead
b) His original salary.
DISCOUNTS & TAXES
15. The retail price for a printer is $700 but it is being offered at a 35% discount. How much does
Ryan pay if he buys the printer at the discount price?
16. A store sells a phone for $425 and this included a 15% discount.
a) What was the discount amount?
b) What was the original cost of the phone?
17. A bottle of wine cost $80 plus value added tax of 15%. How much does a customer actually pay
for the bottle of wine?
18. If a watch cost $460 and includes a sales tax of 20%, how much was the retail price of the watch
before the sales tax?
HIRE PURCHASE – TWO TYPES – You should know both (19 & 20….20 is harder)
19. The retail price on a bed is $2500 and the buyer paying cash, pays 10% below this retail price. If
the bed, however, is bought on hire purchase the terms are $500 down and 18 monthly
instalments of $150.
a) Determine the difference between the hire purchase price and the cash price.
b) Calculate the difference as a percentage of the retail price. (Ex5j no. 7)
20. A fridge can be bought on hire purchase by making a deposit of 15% of the cash price which is
$2975. Interest which is equivalent to 20% of the outstanding balance is charged. The amount
is payable in 12 monthly instalments. Calculate:
a) The deposit
b) The amount of each instalment
c) The difference between the hire purchase price and the cash price
d) The difference as a percentage of the cash price. (Ex 5j, no. 9)
21. A freezer can be purchased with cash for $2845 or on hire purchase for a deposit of 25% and 18
monthly instalments of $142.25. Calculate for the chest freezer.
a) The hire purchase price
b) The interest charged
c) The percentage interest charged on the outstanding balance. (Ex 5j, no. 15)
Mortgage
22. An apartment is priced at $235,000. If an 85% mortgage can be obtained over 20 years,
calculate:
a) The deposit payable
b) The loan amount needed
c) The total amount of money paid to the bank if each monthly payment was $2829.
d) The total amount of interest paid to the bank
e) The total amount paid for the apartment
SIMPLE INTEREST
23. Mr. Smith took a loan from a bank at 13.5% per annum for 6 months and paid $360.45 simple
interest. Calculate the amount of money he borrowed.
24. The simple interest on $15,000 for 9 years is $6750. Calculate the rate per cent per annum.
25. Mrs. Oliver borrowed $18,900 at 13.5% per annum and repaid $12,757.50 simple interest.
Calculate the period of the loan.
26. Calculate the simple interest collected by a bank if $1500 is the loaned for 3 years at 8% per
annum.
a) What amount of money did the borrower actually pay the bank?
b) What amount of money was paid monthly?
SIMPLE INTEREST & HIRE PURCHASE (Difficult so please try these)
27. The marked price of a car is $49,500. A person can pay a deposit of 30% and simple interest at
12% per annum is charged on the outstanding balance. The total amount payable is to be paid
in 2½ years. Calculate:
a) The amount of each instalment
b) The hire purchase price of the car.
c) The total amount of $49,500 can be borrowed from the bank at 11% per annum for a period
of 3 years. Calculate:
i) The total amount to be repaid to the bank
ii) The amount of each monthly instalment (page 215 number 38, ex 5S)
28. The cash price of a stove is $2,845.00
a) It can be bought on hire purchase if a deposit of $710 is first paid. Simple interest at 10%
per annum for 2 years is then added to the outstanding balance. Calculate the total amount
paid for the stove.
b) The stove can also be bought by borrowing the cash price from a bank at 10% simple interest
and the principal and interest must be repaid at the end of two years. Calculate the amount
to be paid for the stove by this arrangement.
c) Which arrangement is better and by how much? (page 215 number 39, ex 5S)
COMPOUND INTEREST & SIMPLE INTEREST – LEARN THE FORMULA
29. A man wishes to invest $3500. He can buy saving bonds which pay simple interest at the rate of
12% per annum or he can start a savings account which pays compound interest at the same
rate. Calculate the difference in the amounts of the two investments at the end of 6 years. (pg
220, number 13, Ex 5t)
DEPRECIATION – LEARN THE FORMULA
30. A man buys a car for $75,600. The insurance company decides to depreciate the car each year
by 9%. Calculate the book value of the car after 6 years. (pg 224, number 9, Ex 5u)
31. A man bought a car for $60,320. After using for 2 years he decides to sell it. The estimated the
depreciation is 15% for the first year of its use and a further 15% on its reduced value for the
second year.
a) Calculate the value of the car after 2 years
b) Express the value of the car after 2 years as a percentage of the original value.
c) Express the depreciation after the 2 year period as a percentage of the original value. (pg
224, no. 11, Ex 5u)
FOREIGN EXCHANGE
32. The table below gives the exchange rates for some Caribbean currencies against the US dollar.
Territory Amount for US $1.00
Eastern Caribbean EC $2.70
Guyana G $3.00
Jamaica J $2.25
Trinidad and Tobago TT $2.40
Calculate
a) The amount in Jamaican dollars one would get for US $200
b) The amount in US dollars one would get for TT360
c) The amount in EC dollars one would get for G$50. (Ex.5V no. 7)
