



 
Hi Lok, 5% is not 1.05, 5% is 0.05. I think I know where the confusion arises. Suppose you buy an item for $47.76 and there is a 5% sales tax. You then have to pay $47.76 plus 5% of $47.76. This is
Thus multiplying the selling price by 1.05 gives the cost, including the 5% sales tax. Does this help?  


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