Discount Calculator
Calculate the final price after one or two stacked discounts, and the true effective discount rate.
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Example 1 โ Lump sum, no contributions
A = 1,00,000 ร (1.10)^10 โ โน2,59,374 โ more than 2.5ร growth
๐ What is the Discount Calculator?
Stacked discounts are a common source of confusion because they feel like they should simply add together, but they do not โ each successive discount applies to an already-reduced price, which means the combined effective discount is always slightly less than the sum of the individual percentages.
โ๏ธ How Discount Calculator is calculated
Why discounts compound rather than add
A 20% discount followed by a 10% discount means: first multiply the price by 0.80, then multiply that result by 0.90. The combined multiplier is 0.80 ร 0.90 = 0.72, meaning the final price is 72% of the original โ a 28% total discount, not 30%.
The general rule for any two stacked percentages
For any two discounts A% and B%, the combined effective discount is always slightly less than A% + B%, with the gap growing larger as the individual percentages increase.
Why retailers sometimes present discounts this way
Advertising "20% off, plus an extra 10% off" can sound more generous than the mathematically equivalent single 28% discount, even though the actual saving is identical โ a useful thing to recognise as a shopper.
Stacked discount
Final price = price ร (1 โ discount1%) ร (1 โ discount2%)
๐งฎ Worked examples
Example โ 20% then 10%
A โน1,000 item with 20% off, then an additional 10% off the discounted price.
โ Final price = โน1,000 ร 0.80 ร 0.90 = โน720. Effective total discount = 28%, not 30%
Example โ single equivalent discount
What single discount percentage would produce the same โน720 final price directly?
โ A flat 28% discount on โน1,000 also gives โน720 โ confirming the stacked discount is mathematically identical to a single 28% reduction
๐ก Original insights & how to use this calculator
Comparing "stacked" deals against a single flat discount
When deciding between a retailer offering stacked percentages versus a competitor offering one flat percentage, calculate the actual final price for both rather than comparing the headline numbers directly.
Understanding why the order of discounts does not matter
Multiplying by 0.80 then 0.90 gives the same result as multiplying by 0.90 then 0.80 โ the order of stacked percentage discounts does not affect the final price, only the total number of discounts applied does.
Calculating the true effective discount rate for budgeting
Knowing the real combined percentage (28%, not 30%) matters when comparing your actual savings against a budget or when comparing deals across different stores with different discount structures.
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๐ก Expert tips
Stacked discounts (e.g. 20% + 10%) are never simply additive โ they compound on the already-reduced price, so the real total is always less than the sum.
โ Common questions
Does 20% off + 10% off equal 30% off?
No โ the second discount applies to the already-discounted price, so 20% + 10% works out to 28% total, not 30%.
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