Discount & Sale Price Calculator

How Discounts and Sale Prices Work

Whether you are shopping a sale or pricing products for your business, understanding how discounts are calculated ensures you never overpay or undercharge.

The Double Discount Myth

Many shoppers assume that a 20% off coupon stacked with a 10% sale means 30% off. In reality, the discounts are applied sequentially: the second discount applies to the already-reduced price, not the original. A 20% + 10% double discount actually equals a 28% effective discount — costing you 2% more than you might expect.

The formula is: Effective Discount = 1 - (1 - d1) x (1 - d2), where d1 and d2 are the two discounts expressed as decimals.

Psychological Pricing

Retailers use several pricing strategies to influence purchase decisions:

• Charm pricing: Ending prices in .99 or .97 ($29.99 instead of $30) makes items feel significantly cheaper due to left-digit anchoring.
• Anchor pricing: Showing the original price next to the sale price creates a perception of value. A "was $100, now $59" sign is more compelling than simply "$59."
• Bundle discounts: Offering "Buy 2, Get 1 Free" (effectively 33% off) often moves more inventory than a straight 33% discount because customers perceive free items as more valuable.

Tips for Shoppers

Always calculate the actual dollar amount you are saving, not just the percentage. A 50% discount on a $10 item saves $5, while a 10% discount on a $200 item saves $20. The bigger percentage is not always the better deal.