A shop owner offers the following discount options on an article to a customer:
1. Successive discounts of 10% and 20%, and then pay a service tax of 10%
2. Successive discounts of 20% and 10%, and then pay a service tax of 10%
3. Pay a service tax of 10% first, then successive discounts of 20% and 10%

Which one of the following is correct?

Correct Option: (d) All the options are equally good for the customer.

Let us calculate the net price paid by the customer under each option for an article with marked price P. Option 1: Successive discounts of 10% and 20%, then pay 10% service tax. Price after 10% discount = 0.90 P. Price after 20% discount = 0.90 P * 0.80 = 0.72 P. Adding 10% service tax = 0.72 P * 1.10 = 0.792 P. Option 2: Successive discounts of 20% and 10%, then pay 10% service tax. Price after 20% discount = 0.80 P. Price after 10% discount = 0.80 P * 0.90 = 0.72 P. Adding 10% service tax = 0.72 P * 1.10 = 0.792 P. Option 3: Pay a service tax of 10% first, then successive discounts of 20% and 10%. Price with 10% service tax first = 1.10 P. Price after 20% discount = 1.10 P * 0.80 = 0.88 P. Price after 10% discount = 0.88 P * 0.90 = 0.792 P. Multiplication is commutative and associative. In all three options, the final effective price is exactly 0.792 P. Therefore, all the options are equally good for the customer.