Discount
A reduction from the regular price of goods or services, commonly offered as a percentage decrease or fixed amount reduction.
What Is a Discount?
A discount is a reduction from the regular price of a product, service, or financial instrument. It is a common pricing strategy used by businesses to attract customers, reward specific groups, or clear inventory.
Types of Discounts
1. Percentage-Based Discounts
A percentage is subtracted from the original price. For example, a 20% discount on a $100 item reduces the price to $80.
2. Fixed Amount Discounts
A set dollar amount is deducted from the total. For example, $10 off a $50 purchase brings the final price to $40.
3. Stackable Discounts
Multiple discounts can be combined, such as applying a 10% discount followed by an additional $5 off.
4. Eligibility-Based Discounts
Targeted at specific groups like students, seniors, military personnel, or low-income individuals. For example, transit systems offer 50% off for youth and seniors, while some brands provide discounts for teachers and healthcare workers.
5. Bulk Purchase Discounts
Offered when buying larger quantities, such as "Buy 2, Get 1 Free."
How Discounts Work
- Calculation: For percentage discounts, multiply the original price by the discount rate (e.g., 15% off = 0.15 deduction). Subtract this from the original price.
- Verification: Some discounts require proof of eligibility (e.g., student ID, military service documents).
- Terms: Always check exclusions (e.g., certain brands or sale items may not qualify) and expiration dates.
Real-World Examples
- Transit Systems: Offers 50% off for low-income riders and seniors, and a bulk fare purchase discount for larger transactions.
- Retail: Seasonal sales (e.g., Black Friday) often feature deep discounts to drive holiday shopping.
Key Takeaways
- Discounts reduce the cost of goods/services, making them more accessible.
- Businesses use them strategically to boost sales or reward loyalty.
- Always verify eligibility and review terms before applying discounts.