Smart shopping: how discounts really add up

Single discounts

Sale price = original price × (1 − discount). A $80 jacket at 25% off costs $80 × 0.75 = $60. You save $20.

Stacked discounts don't add up

A 20% sale plus an extra 10% coupon is applied one after another: $100 × 0.80 × 0.90 = $72. That is 28% off in total, not 30%. The second discount works on an already reduced price.

The order of percentage discounts doesn't matter, but a fixed-amount coupon does: $10 off before 20% gives $72, while $10 off after 20% gives $70.

Multi-buy offers

'Buy one, get one free' is a 50% discount per item — but only if you need two. 'Three for the price of two' is 33.3% off per item. 'Second item half price' is 25% off across two items.

Compare the unit price

Divide the price by the quantity to get the price per kilogram, litre or piece. A 750 g pack for $4.50 costs $6.00 per kg; a 1 kg pack for $5.50 costs $5.50 per kg, so the larger pack is cheaper even though its shelf price is higher.

Don't forget tax and tips

In the US, sales tax is added at the checkout, so the final price is higher than the tag. At restaurants, tipping customs vary widely between countries — calculate the tip on the pre-tax amount where that's the local norm.