**– Dollars list price – $435.20\$$**

**– Trade discount rate – $26\%$, $15\%$,and $5\%$**

The aim of this article is to find the **net price factors** from the given **trade discount rate** and use them to find the **net price**.

The basic concept behind this article is the understanding of **Item List Price**, **Trade Discount**, and the **Complement Method** to find the **Net Price**.

The **price** at which an **item** is generally being **sold** is called its **List Price** or **Catalogue Price**. In order to purchase the item at a **discounted rate**, a **trade discount** is offered on the **List Price**. The **Trade Discount** is defined as the amount of **discount** being offered on the item by expressing it as a **percentage** of the **List Price**. After incorporating the **discount**, the **final price** that is to be **paid** for the **item** is called **Net Price**.

The **Net Price** is also calculated by using the **Complement Method** for **Trade Discount**. It the defined as $100\%$ **minus** the **discount rate** to calculate the **Net Price Rate** and then **multiply** it with the **List Price** to find the **Final Net Price** of the item:

\[Net\ Price\ Rate=100\%-Trade\ Discount\ \%\]

\[Net\ Price=List\ Price\times Net\ Price\ Rate\]

If **multiple trade offers** are given, then their **total net price factor** is calculated by **multiplying** the **percentage** of the **net price factor for each trade offer**. And the **total net price** is then calculated by using the **Complement Method** as explained before.

## Expert Answer

**Dollars List price** – $435.20\$$

**First Trade Discount Rate** $TDR1=26\%$

**Second Trade Discount Rate** $TDR2=15\%$

**Third Trade Discount Rate** $TDR3=5\%$

Initially, we will calculate the **Net Price Factor** for each **Trade Discount Rate** as follows:

\[Net\ Price\ Rate=100\%-Trade\ Discount\ %\]

**First Net Price Rate** $NPR1$ is:

\[NPR1=100\%-TDR1\]

\[NPR1=100\%-26\%\]

\[NPR1=74\%\]

\[NPR1=0.74\]

**Second Net Price Rate** $NPR2$ is:

\[NPR2=100\%-TDR2\]

\[NPR2=100\%-15\%\]

\[NPR2=85\%\]

\[NPR2=0.85\]

**Third Net Price Rate** $NPR3$ is:

\[NPR3=100\%-TDR3\]

\[NPR3=100\%-5\%\]

\[NPR3=95\%\]

\[NPR3=0.95\]

The **total net price factor** is calculated by **multiplying** the **percent of the net price factor** for each **trade offer**:

\[NPR=NPR1\times NPR2\times NPR3\]

\[Net\ Price\ Factor\ NPR=0.74\times0.85\times0.95\]

\[Net\ Price\ Factor\ NPR=0.59755\]

The **net price** is also calculated by using the **Complement Method** for **Trade Discount** as follows:

\[Net\ Price=List\ Price\times Net\ Price\ Factor\]

Substituting the values in the given equation, we get as follows:

\[Net\ Price=435.2$\times0.59755\]

\[Net\ Price=260.05376$\]

## Numerical Result

The **Net Price Factor** $NPR$ is:

\[Net\ Price\ Factor\ NPR=0.59755\]

The **Net Price** is:

\[Net\ Price=260.05376$\]

## Example

Compute the **Net Price** using the given **List Price** and **Trade Discount Rates**:

**Dollars list price –** $325\$$

**Trade discount rate –** $20\%$, and $12\%$

**Solution**

**First Trade Discount Rate** $TDR1=20\%$

**Second Trade Discount Rate** $TDR2=12\%$

**First Net Price Rate** $NPR1$ is:

\[NPR1=100\%-TDR1\]

\[NPR1=100\%-20\%\]

\[NPR1=80\%\]

\[NPR1=0.80\]

**Second Net Price Rate** $NPR2$ is:

\[NPR2=100\%-TDR2\]

\[NPR2=100\%-12\%\]

\[NPR2=88\%\]

\[NPR2=0.88\]

The **total net price factor** is calculated by **multiplying** the **percent** of the **net price factor** for each **trade offer**:

\[Net\ Price\ Factor\ NPR=0.8\times0.88\]

\[Net\ Price\ Factor\ NPR=0.704 \]

The **Net Price** is as follows:

\[Net\ Price=List\ Price\times Net\ Price\ Factor \]

\[Net\ Price=325$\times0.704 \]

\[Net\ Price=228.8$ \]