AMC 10 · 2007 · #5

Grade 7 algebra
percentagelinear-equations-one-varfraction-arithmetic convert-to-algebra ↑ Prerequisites: percentage
📏 Medium solution 💡 2 insights
Problem
A first tax takes 20 percent, then a second takes 10 percent of what remains. The two together come to a known amount. Find the original total.

Pick an answer.

(A)
30000
(B)
32500
(C)
35000
(D)
37500
(E)
40000
How to solve
Strategy Introduce a Variable

The inheritance is the one thing we do not know, so Tool #4 (Introduce a Variable) names it x and lets every tax become a piece of x. Tool #13 (Convert to Algebra) turns the words "20% of it" and "10% of what is left" into expressions, so the two taxes add into a single equation about x. Tool #3 (Eliminate Possibilities) offers a fast check: the total tax is a bit more than 1/4 of the inheritance, so x must be a little under four times 10500, which already points at the larger choices.

1STEP 1

Name the inheritance

Naming the original total gives everything one letter to hang on.

x = inheritance in dollars
2STEP 2

Federal tax and the leftover

The first tax leaves a plain fraction of that total.

federal = 0.20x, left = x - 0.20x = 0.80x
3STEP 3

State tax on what is left

The second tax is a percent of that leftover, not the original.

state = 0.10 × 0.80x = 0.08x
4STEP 4

Add the taxes into one equation

Adding the taxes gives one equation.

0.20x + 0.08x = 0.28x = 10500
5STEP 5

Solve for the inheritance

Solving gives 37500, choice (D).

x = 10500/0.28 = 37500 → (D)
Answer
37500
Check by running the tax forward on x = 37500: federal is 0.20 × 37500 = 7500, leaving 30000; state is 0.10 × 30000 = 3000. The two taxes are 7500 + 3000 = 10500, exactly the given total. The size is sensible too: total tax is 0.28 of the inheritance, a bit more than a quarter, so the inheritance should be a bit under 4 × 10500 = 42000, and 37500 fits.
💡Key takeaway

When one percent is taken and then another percent is taken from what is left, write each tax as a piece of the same unknown, add the pieces, and solve the single equation.

  • Name the inheritance
  • Federal tax and the leftover
  • State tax on what is left
  • Add the taxes into one equation
  • Solve for the inheritance