Depends on how you l;ook at it. The "price" of something is what you pay for it - including tax. Paying $50,000 in the one case or $129.87 in the other is merely lising the total price you pay.It's not the total price I pay because I also pay state sales tax. So what's the point of using the inclusive rate again?
The tax in either case is 23% t-i (or 29.97% t-e). It is the same amount of tax in either case for the particular item. Are you 6 feet tall or 72 inches tall??I'm 6'2", and if I grow 10%, how tall would I be.
Instead of the odd example you gave you could have just divided $100 by (1-0.23) which gives 29.97% directly. Same result. The amount you p[ay is the same also - $129.87 for your example.Let's see. I could either figure the tax by:
price * exclusive rate = tax
or by:(price / (1 - inclusive rate)) - price = tax
Gee, tough choice.But it IS the total price you pay with respect to the product cost and the federal sales tax - state sales tax was never part of the discussion. I repeat - the price is what you pay for the item, including the tax.
Gee - a real mind-bender there ... lessee; would you be 10% taller? That'd be either was you meansure it BTW.
You could also just divide your $100 by 0.77 and that would give $129.97. We were trying to arrive at the purchase price, not the tax.